The speed at which innovation is happening for NFT-related financial services is miraculous. We previously discussed Escrow for NFTs and how they’re being collateralized for loans. And now, there’s a rental service for NFTs.
NFT Rentals w/ reNFT
I’m a little peeved that I didn’t come across this concept from reNFT earlier. Nonetheless, I now am aware that renting / loaning NFTs is now possible.
reNFT created a blockchain protocol where NFT owners can lend their NFTs to complete strangers for a set period of time and price, with the assurance that they’ll get their assets back.
It’s slightly different from NFTfi.com’s marketplace which connects NFT owners with lenders to get an Ethereum loan on the value of their NFT.
reNFT’s protocol actually allows the NFT to change hands between renter and lender.
- Lender: Defines the rental price, the necessary collateral, and the max rental period.
- Renter: Specifies the rental duration, pays the rental price, and receives the NFT.
At the end of the rental period, reNFTs smart contract returns the NFT to its rightful owner and the collateral to the renter.
I’m sure you’re thinking who in the world would actually want to rent an NFT.
NFT Rental Use Cases
After pondering on this concept of NFT Rentals, here are the value propositions I envision.
Short-Term Flex – Many people use NFTs as their profile picture to gain respect in the NFT community. With Twitter’s NFT verification coming (thus eliminating fraudulent NFT profile pictures), this service could really show benefit to those who are trying to build their name in the NFT space and want a high-value NFT as their profile picture.
Art Installations and Exhibitions – We’ve seen a variety of venues start to create NFT galleries or installations – from DREAM Hollywood to the imnotartgallery to LA’s first NFT art gallery. A rental NFT service creates less friction for serving galleries and venues that want to legitimately display original NFT artwork.
Digital Art Dealers – I believe there is going to be an entire profession of Digital Art Dealers who represent NFT collectors and help them sell their NFTs. This reNFT protocol would make it easier for Digital Art Dealers to hold multiple clients’ NFTs in their wallets at a time, without creating any friction or failure.
Gaming Loans – This concept isn’t exactly new, since Axie Infinity’s Scholar program works in a similar way. However, with blockchain gaming on the rise, owners of NFT game items (who may not have time to actually play the game) could still earn revenue by renting their NFTs to other players. It’s a win-win, as players get to use the items and level up their characters. A tangential idea here is that for NFT projects where there is a possibility for breeding multiple NFTs together to create a new NFT, this service could facilitate that transaction.
Overall, this is another great example of how the NFT market is rounding out the experiences to make them more accessible to all. Undoubtedly, there are NFT Rental use cases I’ve overlooked. Nonetheless, I’m excited to see NFT Rentals take off and am intrigued to see what the primary, main use case is that makes the world aware of this strange service.
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