Coming Soon

NFTs as collateral

This feature will allow users to deposit qualifying NFTs—such as v3 DEX liquidity position NFTs—and leverage them to borrow additional assets. By holding an NFT representing your liquidity in a concentrated range or unique position, you can unlock the value of that position without having to exit or dismantle it.

What to expect

Potential Eligibility for v3 DEX LP NFTs Liquidity provider positions on certain v3 DEX platforms are represented as unique NFTs, capturing custom price ranges and token amounts.
Borrowing Without Unwinding Instead of withdrawing liquidity from the DEX, you can deposit the NFT as collateral and borrow from Nexus, enabling you to retain your liquidity and earn DEX fees while accessing additional capital.
Flexibility & Efficiency NFT collateralization opens up new avenues for advanced DeFi strategies, such as leveraged liquidity provisioning, hedging, or diversifying into other assets without sacrificing your existing yield opportunities.

Benefits

Unlock Liquidity With NFT-based collateral, your liquidity positions remain actively earning fees on the DEX, while simultaneously allowing you to borrow stablecoins or other tokens in Nexus.
Capital Efficiency for Active Traders Advanced users can combine leveraged borrowing with liquidity positions to quickly rotate capital across multiple yield opportunities or hedge market swings.
Maintain Custom Positions v3 DEX positions often utilize custom price ranges. Using NFTs as collateral means you don’t have to lose that optimized position simply to gain borrowing power.

Risk Parameters

Due to the unique and often volatile nature of NFT valuations, collateral parameters may differ from typical ERC-20 tokens:

Loan-to-Value (LTV): Likely lower than standard tokens due to higher volatility and liquidity constraints.
Liquidation Threshold: NFT collateral might have a tighter liquidation threshold to mitigate rapid drops in value.
Liquidation Process: If a user’s health factor falls too low, the NFT can be seized by the protocol and auctioned to liquidators.

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Last updated 1 month ago

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NFTs as collateral

What to expect

Potential Eligibility for v3 DEX LP NFTs Liquidity provider positions on certain v3 DEX platforms are represented as unique NFTs, capturing custom price ranges and token amounts.

Borrowing Without Unwinding Instead of withdrawing liquidity from the DEX, you can deposit the NFT as collateral and borrow from Nexus, enabling you to retain your liquidity and earn DEX fees while accessing additional capital.

Flexibility & Efficiency NFT collateralization opens up new avenues for advanced DeFi strategies, such as leveraged liquidity provisioning, hedging, or diversifying into other assets without sacrificing your existing yield opportunities.

Benefits

Unlock Liquidity With NFT-based collateral, your liquidity positions remain actively earning fees on the DEX, while simultaneously allowing you to borrow stablecoins or other tokens in Nexus.

Capital Efficiency for Active Traders Advanced users can combine leveraged borrowing with liquidity positions to quickly rotate capital across multiple yield opportunities or hedge market swings.

Maintain Custom Positions v3 DEX positions often utilize custom price ranges. Using NFTs as collateral means you don’t have to lose that optimized position simply to gain borrowing power.

Risk Parameters

Due to the unique and often volatile nature of NFT valuations, collateral parameters may differ from typical ERC-20 tokens:

Loan-to-Value (LTV): Likely lower than standard tokens due to higher volatility and liquidity constraints.

Liquidation Threshold: NFT collateral might have a tighter liquidation threshold to mitigate rapid drops in value.

Liquidation Process: If a user’s health factor falls too low, the NFT can be seized by the protocol and auctioned to liquidators.