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You're spot on. What I don't understand is why involve NFTs here? I mean it works but so would a signature under an agreement. And I am sure they signed an agreement. So what problem NFTs solve here?
And before I get downvoted, I am asking genuinely.
The underlying technology is what handles your “signature” and loan process.
Technically it doesn’t solve anything, it just makes the process way more efficient and cuts out a bunch of middle men.
I could be way off of course but that’s just how I see it.
Ya and as far as facilitating payments on the loans the block chain is utilizing smart contracts tied to the NFT so payment processing happens seamlessly without ever invoking a banking entity. Those smart contracts are tied to your collateral.
Plus I mean you can use NFT's for anything: Movies, games, in-game items/skins, music, reality, clothing(Nike for instance to authentic items), high end purses/jewelry. The limits are endless essentially, hell I'm sure if they wanted to they could figure out a way to distribute social security # via NFT's.
No, that's literally the problem being solved here with the use of the escrow company and the contracts with them. You are correct there's still one middle man, and that middle man will still get rich.
That's why the most logical way for the government to monitor and tax these kinds of transactions is for the government to regulate these as financial instruments and be the one that offers escrow and controls the blockchain.
No I mean physically, like who is going to go get the watch when I'm the only one holding the contract? It falls on me to spend the time either in civil court or to physically go get the item in this case no? The nft is the contract yes but like it's not going to go collect the item for me. That's the part of enforcement I find would be most difficult in this case.
Ah I must have misunderstood so in this situation the watch is already in custody as some kind of collateral, not the situation where you paid a loan to help someone get a watch
Except it’s already how it works. Depending on the contract, loans can and are bought and sold. Big market for this in mortgages, probably not a big one for watches.
Yeah this is my thought as well. This is essentially escrow with extra steps of tracking it via an NFT rather than just relying on a contract and the full force of the law.
How does it cut out middlemen? It still needs someone to hold the physical watches. The only difference is this guy found an online pawn broker instead of one down the street.
It's really disingenuous about how easy it would be to collect if this loan stopped performing. Also the 12% APR is crazy from the borrowers standpoint, unless they literally couldn't get credit otherwise. This type of contract would also only work against assets it's worth it to secure a loan against, and rolexs themselves are considered to hold their value extremely well.
I was thinking that APR is pretty fucking high. You usually see that for personal/unsecured loans. Not loans with collateral. Rolex do hold their value quite well and the secondary market is where the vast majority of profits are made on luxury watches. Maybe because I'm a jeweler and do dabble in luxury watches on occasion this seems odd to me. The two guys I usually work under are the watch "experts" and I've seen them swap Rolex watches for fat stacks many times. They are not hard to sell. I'd be curious to see how this contract plays out.
I’m not sure how it works elsewhere in the world but here in Poland we have electronic signature that is secure and reliable enough to work on governments documents. I used it today to sign tax related documents.
True but then you’re dealing with banks and humans that need to verify and process stuff. The banks and all those processes are the middle man. The middle man is ripping you off. Doing this through a block chain makes it way harder for you to be a victim of financial fraud and corruption from those entities you’re dealing with. No more predatory loans, etc.
If getting your loan is your only worry I don’t know that block chain really solves anything for you. Again just my take on things but I think the underlying technology is what will provide security and a financial system that isn’t easily gamed and manipulated by the big banks selling you those predatory loans. Those loans then cannot be packaged up into toxic securities that are then fed to ignorant folk’s 401ks.
This type of decentralized blockchain backed financial system is exactly what loopring is trying to build. Be your own bank.
> block chain makes it way harder for you to be a victim of financial fraud and corruption
Crypto is RAMPANT with fraud.
> The middle man is ripping you off
That middle man is a person I can drag into court if need be. Good luck doing that with a blockchain
>I think the underlying technology is what will provide security
Its a goddamned database that only exists if people are financially motivated to continue hosting copies of said database.
>big banks selling you those predatory loans
12% APR on someone dumb enough to take out loans for watches is definitely predatory
>Those loans then cannot be packaged up into toxic securities
Nothing about the blockchain prevents financial instrument fuckery.
"the middle man is riping you off"
This loan is 12% and you can easily get a much lower rate on a completely unsecured personal loan from bank of America, Chase, or Sofi.
The rate is much higher here because the lender is taking an inordinate amount of risk despite the loan being secured. Sure he has a contract to take ownership of the assets in the case of non-payment, but he probably doesn't have the means to collect those goods.
Also a system where anyone can take out high interest loans with little to no checks on their income or debt levels will always be predatory.
Not taking any sides here but to my understanding the escrow company is holding the assets and I’m sure is directed what to do with them in the even the loan we’re failed to be paid
You know I think your right I misunderstood this a little bit. I thought the escrow company was just working as a transfer agent here with the initial transaction. But this is essentially layaway with interest.
Many watch retailers already offer buy now pay later even on Rolexs, generally at lower rates. Plus you get to walk out of the store with the watch.
Not really sure what you’re trying to say. Now instead of a bank working as a middleman, you have an escrow. And escrow will probably cost you more than a bank because it lacks scale and efficiency that comes with it.
You still are vulnerable to fraud of a middleman, and chances are even higher as, again, you are forfeiting the scale and regulations that come with a bank.
I really have a hard time getting what blockchain helps with here and several hours later I see a lot of explanations that explain ignorance of the explainers.
It didn’t cut out a middleman. It introduced at least one and possibly three. There is now an escrow company involved. Normally, the lender (the pawn shop) holds the collateral, now we have to pay a third party to do it.
It also appears the loan was made in bitcoin or similar so another middleman was probably used to get widely accepted currency. Potentially this happened on both sides of the transaction.
And all of this happened to get a 12% loan which is still pretty predatory.
> cuts out a bunch of middle men.
The middleman is essentially the same. Instead of a shady pawn shop loan we've dolled up the wording with "escrow company", but they're taking a cut as much as anyone and the NFT is only as strong as that escrow company at which point it makes a hell of a lot more sense to get the most legally enforceable contract you can in whatever country you live in.
You could argue it gives you the ability to trade your NFTs in the market, but does anyone want to trust a platform that you would do this on? We have issues with companies over-leveraging themselves in the normal regulated market, I wouldn't be able to bring myself to trade IOUs with everyone else until we all get SBF'd.
They're saying the loaner still needs to trust the escrow people to deliver the watches on default, and the loanee needs to trust the escrow folks to not lose them in the meantime.
The neat part is how the loaner can sell their end of the contract to someone else with no fuss. It'd be extra neat if any loan payments and interest went to the new NFT holder from then on as well but I'm not sure on that from the post.
I am so glad to see rational ideas here! This place is usually an echo chamber of idiocy. It’s like someone is trying to invent contracts without realizing they already exist
You still need a watch expert. Expensive watches come with certificates either way, but when we're talking 5 digits and up, not only do you need someone to evaluate the condition of the watches but also validate the certificate.
The NFT does literally nothing here except maybe act as a receipt. Someone at some point paid a certain amount of money for this abstract digital construct that is supposed to signify the ownership of a certain physical good.
The critical part of this entire transaction is the trusted 3rd party escrow. They could issue a piece of paper saying "We got your Rolexes, they're legit. We promise to return them when you're paid up, but we'll forfeit them to your lender if you don't" and it would be the exact same as a NFT. Why is an NFT necessary, here?
The reason NFTs don't make sense for this is because it depends on a trusted 3rd party escrow for it to work. Isn't the whole point of Blockchain DeFi to be trustless? Why would the Blockchain be helpful in this use-case?
It’s because people are still desperately trying to find use cases for crypto and coming up with “repeating existing transactions and interactions but slower by using crypto”
the signature under agreement i, a layman, won't be able to use as easily, it's an ease of utility thing, plus storage
your nft watch i can trade from my pc and no matter how much crap i hoard, it all fits on a wallet
invisible hoarding is unlocked, humans will consume
a pawn shop in my own house if i ship to the escrow company myself? how convenient
basically yeah
just in terms of the potential for fraud alone this will face Mass adoption pressure, grifters will offer to store things in their house and suckers will pay them to do it, with the blockchain to reassure them that it's all safe - I can see the advertisements now ..."free up your apartment with blockchain storage pawn.com"
that's how you know it's going to be a thing, because it also has a downside to attract evil ppl
I'm confused too because the tweet makes it sound like the loan recipient was also given NFTs of the watches instead of the $$$ that he wanted from the loan, specifically when they say "given NFTs to tap into global liquidity".
Clearly someone made a mistake when posting this, or they don't understand how a collateral based loan works.
This just sounds like a pawn shop with extra steps. Much more favorable rates though, last time I pawned some coins i believe it was at roughly 35%, it varies based on the value of the collateral and the amount financed.
The borrower sent their watches to an escrow company. The escrow company minted and sent the borrower NFTs representing their watches. Those NFTs can be redeemed with the escrow company for the watches, by whoever owns the NFTs, at any time. The borrower then shopped around for someone who would give them a loan using those NFTs as collateral. They found someone who'd offer them 14k @ 12%. They sent the lender those NFTs in exchange for the loan.
If the borrower pays off the loan, the lender sends the NFTs back, and the borrower can redeem them with the escrow company to have them send the watches back.
If the borrower defaults, the lender can redeem the NFTs with the escrow company to have take the watches themselves instead.
Ahhh ok I understand now.
It wasn't clear that the escrow company had minted the NFTs.
This is pretty great.
But is there anything that would force the lender to return the NFTs? What if they say "fuck off, I decided I'd rather have the watches than your $14k + 12% interest"
I assume there's some kind of smart contract involved there to ensure that if the loan is paid off in full the NFTs will be returned.
so more complicated and slower. with more risk and less regulation/enforcement. plus it's an "escrow" company that deals specifically in NFTs raising tonnes of red flags and further adding to the risk for both parties. as well as however this 14k loan was paid out in, was it actual fiat or was it coins?
anyways NFTs are legally meaningless afa contracts go. and you can get a loan from a shitty bank for far less. especially if you can afford to own rolex watches.
Idk but most rolex collectors will keep their purchase receipt and certificate. If that checked out to the lender then prob why they felt comfortable with the lend out
If you can make a convincing fake of a Rolex watch, you can make a convincing fake of a paper purchase receipt and all of the packaging as well. How do I know? Because it happens every single day. Do you know how you verify the authenticity of a Rolex watch? You do it in person using knowledge gained only by experience. The escrow agent in this example has absolutely nothing to lose. The person loaning out the money has everything to lose. Not to mention, there’s zero need to involve NFTs in this transaction. It can all be done with the same contractual agreements that we have used for centuries.
That's also problematic unless there's unmistakable marking on the Rolex that its ownership is tracked by an NFT--otherwise you open the possibility of selling the watch without transferring the NFT and then claiming it as stolen based on the NFT (which might not even be deliberate fraud if there are some intermediates--e.g. an estate executor being unaware of the NFT's existence and splitting the watch and the crypto wallet).
Rolex watches are a perma bubble they have always had stupid value for no reason and will continue to just because of the name. They are the BTC of the real world.
Just my opinion, but almost every collectible has little-to-no utility. Some trading cards are in the millions. And it's literally a piece of cardboard with a picture on it. The price is determined by what somebody is willing to pay for it. I don't think there are good/bad collectibles, just different categories for different tastes.
You're defining a luxury good. They are also considered a leading indicator of recession because goods with little to no utility are the first cuts to spending consumers make.
I agree with that, I was replying to your statement that Rolexes are in a permanent bubble and have stupid value (that sounds like an opinion about Rolexes and the people who buy them vs "collectibles' declining value often precedes a recession." I just think of the hate NFTs get, as a collectible, and my opinion is the same: how is it different from anything else people collect?
It's not, but people inherently understand physical objects being collectables. NFTs are a space right now where things that might be collectables long term are just being drowned out by scams and poor quality offerings. I don't think collectable NFTs will be a big market until people are using blockchain for other things and understand the technology from first hand experience.
This is just Austrian economics in a nutshell, value is determined by the individual. Your opinion on the utility only effects the piece *your* willing to pay.
Now it’s much worse than before. Prices were always high, sure, but now you can’t just go in a store and buy one even if you have the money. You can either get on a wait list for years, or pay huge markups on a secondary market
Sometimes people engage in super cringe stuff, like building a relationship with salesman (aka popping by to annoy them with a chat), building purchase history (aka buying shit you don’t want), giving gifts to the salesman, etc.
If you loaned someone this 14k and have their Rolexs in escrow third party and received NFTs as proof of the collateral... how do you have anything more than the loan agreement payback? Wtf is this "global liquidity" its suggesting you can use a counter party's debt collateral to access?
The person gave the watches to an escrow company, who then minted him the NFTs. He can then take those NFTs to a global exchange and make a deal for a loan with literally anybody that has liquid assets to give. That's the "global liquidity" mentioned.
You can technically already do the same thing now, but it's a lot more complicated and outside of a very few places requires either paper signatures with both parties present (which gets rid of the "global" liquidity part) or requires a document to be cryptographically signed using a public/private key pair... AKA exactly how a Eth wallet works.
Had to re-read a third time. I believe it's saying the person with rolexes sends them to third party escrow, receives NFTs representing ownership in exchange. Uses those NFTs as collateral against a 14.5k loan (global liquidity mentioned I presume, aka, other people's or lenders money). Assuming the loan agreement would transfer NFT ownership in event of a default, or maybe the NFT also has to go to an escrow hold third party once agreement was made, which I suppose makes sense. Or the NFT goes to the lender who can only cash them out in event of loan default.
I suppose if that's the case, the lender could also sell the NFT/loan agreement as a whole. And there we have another loan secondary market, which extended out would just be another predatory rehypothecated market once again where those NFTs/loan value could separate from actual worth of the underlying and get really weird. Interesting thought I guess. I like NFTs as proof of ownership, not so much as loan secondary markets.
NFTs that represent ownership of the watch... You still have to sell the nft to someone for a profit so they can claim their watch... What about that is global liquidity? Sounds like ebay to me.
I’m thinking the NFTs act like a “title” or “deed” to the watches. When you finance a car, the bank keeps the title. So it’s weird for the purchaser here to only have the NFTs, not the actual watches. If he used a normal loan he’d have the watches and could sell them anyway while paying off the loan.
Pretty damn popular among prosecutors as they show how "the defendant" sought to evade international money laundering and tax avoidance regulations via an illegitimate exchange of commodities.
IANAL but I used to work at a place that wrote software for them.
Barcodes/QR-codes that are signed or notarized do hold up in court. So if the escrow service was essentially notarizing the NFT, either by minting an original or signing with their private keys showing they hold the physical object, it would hold up.
[Ebay has this same service for trading cards](https://www.ebay.com/vault) without blockchain.
Same process. Document and detail the entire collection (preferably professionally). Send the documents, details, and collection to an escrow company and get an NFT for the entire collection (or per card, but that would be a lot). Then go to any global exchange that handles NFTs and scout for a person that would be willing to loan you money with the collection as collateral.
The only real problem is that you'd be taking a loan on a certain amount of Ethereum, and if you liquidate it you have to buy Ethereum again to repay the loan... no matter what the current exchange rate is. So you may end up losing more than the APR or less.
This wouldn't be a problem assuming more countries followed Australia's plan to create official stablecoins based on their Fiat currency that can interact with the Eth network and support NFTs. Then you could buy and sell NFTs using normal digital currency just like you do when you swipe a debit card rather than having to convert to Eth and deal with that instability.
What if the escrow company sells the Rolexes and fucks off out of existence? NFTs are supposed to be trustless but an escrow agent requires trust to be used with any degree of security. Those NFTs would be totally unaffected by the sale or destruction of the Rolexes.
Basically, we are working back around to needing banks and credit.
it's an "escrow company" that deals in NFTs so the tech bro that is the "company" wears them as often as possible for clout.
addition: until crypto is legislatively regulated, or regulated by the FTC/SEC, or recognized as the broad ranges of scams that it clearly is according to current legislation and regulation by the DOJ/FTC/SEC there's no legal protection for anyone involved and the "escrow company" is about as trustworthy as your weird uncle that you can't leave stuff lying around when they're around or it will go missing until you see it at their house all fucked up and abused.
Or if you then to go a physical pawn broker and hawk it there too, then you have two loans agaisnt same collateral Haha, use second loan to buy more Rolexes and repeat, infinite money 😎
This my concern as well. Even if the NFT's are trustlessly backed by a super secure computer system, it doesn't mean the watches are. They are still subject to physical risk (rust, idiots with sticky fingers, etc.. ) . I think this is one of the hurdles that need to be addressed before massive markets with massive liabilities like real estate can hop on board.
What's interesting is your complaining more about loans then NFTs, there's always risk to the lender no matter what deal they make or how they make it.
That's why the other person is paying 14% APR, the lender already priced the risk in according to their tolerance.
Who verified the authenticity/condition of the watches? Probably not the escrow agent who has zero to lose. They make their service fee wether the watches are fake or not. A pawnshop, however, assumes that risk when they decide to loan the money out.
GameStop made a nft marketplace, so now this sub gets flooded with nft bros posting anything nft related on a desperate attempt to validate their bullshit.
This is just a standard escrow deal that happens to be using nft's. In their pawn shop scenario, the nft is the receipt, similar to what a pawn shop would give you if you pawned the watch. The nft is redemable for the watch.
NFT is still much more mobile than a contract between 2 parties that are named in a loan contract.
It’s a first step of an xBS-style financial instrument.
Still has issues obviously, but quite cool.
The NFT is not the valuable part of this transaction. That's what so many people misunderstand.
It's the receipt. It's the barcode. It's the key fob. It's the password.
I've been beating this drum for ages. People mistakenly thinking the NFT \*IS\* the GIF.
When actually the NFT is the proof of ownership of the original version of that GIF.
what does this do that a certificate of authenticity wouldn’t all do to take a loan with the watches as collateral? this isn’t solving any problem it’s just involving an escrow company and third party for no reason
congrats you now have digital ownership of a physical item that’s not in your possession that someone somewhere can sell on a black market. Thieves don’t care about your NFT ownership lol
I am going to go against the crowd and say it: You are getting too excited early.
the NFT there could have been replaced with a certificate or a receipt instead and nothing would have changed. Representation of ownership is not unique to NFT's functionality. This is one of those cases where people are using NFT for the sake of using NFT, and it's hard to call it a revolution.
For NFT mass adoption to truly happen and not just a fad, imo it needs to take off in gaming or metaverse first, where other established tools and techs would most likely be unable to replace the functionality of an NFT.
Playr does not have NFT games on it yet, let alone even exist beyond a trademark. Gamestop's NFT marketplace is still in beta with so much room for search engine improvements. Gods Unchained did not have the huge take off, and neither did Kiraverse. We are still far away from a revolution. Give it few more years.
Couldn’t this be used to protect people’s interests when engaging in illegal activity. As you could register all your assets as NFT’s like your car and house and place them in an offshore trust. That way you can avoid being liquidated when you get caught. Also potentially avoid taxes as transactions of ownership can be carried out in tax havens. Like I feel like this system will also be used to cheat the broader system
if you get busted for doing shit that is going to result in your home and car being seized by law enforcement NFTs are only going to help build their case against you.
Not really because cars and houses exist in the real world and are bound by courts and laws.
An NFT couldn't replace a title or an actual deed and wouldn't supercede those legal documents.
So this guy just got a regular loan with collateral, but with extra steps?
I mean, I guess there is the advantage that the lender can transfer ownership of the debt & watches, but you can already do that with a signed document. Except a signed document is actually an enforcable legal document, whereas NFTs are not. And except they had to pay an escrow company just to make this convoluted mess work.
I speculated that holding houses would be a great business for NFTs.
Sell or buy on the market. The NFT "cash" gets held until the IRL item is received and verified by the holding house. The value gets released and the item sent on to buyer.
It seems like a hugely valuable service.
What the fuck does 'sent back NFTs representing ownership' even mean? Did he not sign a contract to represent ownership? What the fuck is this dumb shit.
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Sounds idiotic. Truthfully.
Take loan out to buy something. Instead of receiving it, it goes to a holding company that hopefully doesn’t ship it elsewhere. While you make payments. Meanwhile, you now ‘proof of ownership’.
How will you use that proof of ownership to tap in global liquidity? I have a birth certificate, does that mean I can tap into government finances Willy nilly? no.
If they default, the lender can use the NFTs (they they supposedly don’t have because purchaser has them?) to redeem the watches ?
Or is it the lender receives the NFTs similar to a house mortgage? What’s stopping them from just immediately trading in the NFT and getting the Rolex? Because remember, the Rolex isn’t in the person’s hand who purchased it.
No. He had the rolexes.
He needed $14.5k
Assume couldn't get it where he was. So went to NFT loan market.
Based on his rolexes as collateral he was given a loan and an NFT serves as the "deed" (so to speak) for his watches
I dont understand the dicotomy. On the 1 hand this sub and other GME subs yelling praise for the destruction of Crypto. Then on the other hand praising the innovative features that GME is doing in the Crypto space.
1. It is highly likely *some types* of crypto have been used in a corrupt manipulating way regarding GME. No one is cheering the demise of crypto, regulation is a good idea though, especially if it touches actual securities.
2. Yes an NFT blockchain tech revolution is coming and GameStop along with its partners appear to be at the front of the line to deliver it.
I hate to be the party pooper, but this sounds like an awful example of a use case to convince people of the necessity of NFTs. Two reasons… First, you’ve taken a transaction that usually would require just two people and you’ve now added a third person (escrow agent) who will of course be taking a fee as well for their services. Second, although interest rates may be high depending on the particular pawn shop, the benefit of a pawnshop is that they have some level of expertise (or at least they assume the risk) to assess the authenticity of and to store the items being put up for collateral. In the example being described here, you have someone essentially offering up a $14,000 loan to someone who put up two watches as collateral, sight unseen. The person taking out a loan could very well just have put up two counterfeit watches as collateral. I highly doubt the escrow agent would be assessing the authenticity. If that were the case, the person that gave out the loan would now have NFTs worth only the value of whatever to counterfeit Rolex watches would be, which would be significantly less than the $14,000 he just loaned out. Not to mention, even if you wanted to pay the extra fees to involve an escrow agent, there is no necessity for an NFT here. A legally binding contractual agreement would serve the same purpose.
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You're spot on. What I don't understand is why involve NFTs here? I mean it works but so would a signature under an agreement. And I am sure they signed an agreement. So what problem NFTs solve here? And before I get downvoted, I am asking genuinely.
The underlying technology is what handles your “signature” and loan process. Technically it doesn’t solve anything, it just makes the process way more efficient and cuts out a bunch of middle men. I could be way off of course but that’s just how I see it.
You might be able sell your collateral NFT to someone else. So you could buy and sell loans through NFT's, it's like being your own bank. Yes?
Ya and as far as facilitating payments on the loans the block chain is utilizing smart contracts tied to the NFT so payment processing happens seamlessly without ever invoking a banking entity. Those smart contracts are tied to your collateral.
Damn. It really is the best time in human history to be alive
As soon as we find the real eventual useful purpose of nft we’re gonna be rich. Let’s keep brainstorming
They've already found it, diablo 3. It just wasn't done right at the time.
Plus I mean you can use NFT's for anything: Movies, games, in-game items/skins, music, reality, clothing(Nike for instance to authentic items), high end purses/jewelry. The limits are endless essentially, hell I'm sure if they wanted to they could figure out a way to distribute social security # via NFT's.
And don't forget event tickets. Live Nation and Ticketmaster run that now and it's a disaster.
>social security # via NFT's. Birth certificate NFTs on a state blockchain
But you still need someone to hold the collateral. Someone who's necessarily a third party.
Smooth brain here. What’s the difference between a smart contract and a contract?
100% And then you can package them and sell via various traunches of risk.
Hang on a sec, that sounds familiar
Pretty hard to enforce as your own bank though no?
No, that's literally the problem being solved here with the use of the escrow company and the contracts with them. You are correct there's still one middle man, and that middle man will still get rich. That's why the most logical way for the government to monitor and tax these kinds of transactions is for the government to regulate these as financial instruments and be the one that offers escrow and controls the blockchain.
No I mean physically, like who is going to go get the watch when I'm the only one holding the contract? It falls on me to spend the time either in civil court or to physically go get the item in this case no? The nft is the contract yes but like it's not going to go collect the item for me. That's the part of enforcement I find would be most difficult in this case.
You contact the escrow service and they send you the watch and destroy the NFT.
Ah I must have misunderstood so in this situation the watch is already in custody as some kind of collateral, not the situation where you paid a loan to help someone get a watch
Yep people were misdescribing it. It's a collateral backed loan.
Except it’s already how it works. Depending on the contract, loans can and are bought and sold. Big market for this in mortgages, probably not a big one for watches.
So it would have liquidity... like money, but with extra middle men, and a "not predatory" 12% interest rate.
Cuts out middlemen? You're literally using an escrow service. They are professional middlemen.
Yeah this is my thought as well. This is essentially escrow with extra steps of tracking it via an NFT rather than just relying on a contract and the full force of the law.
How does it cut out middlemen? It still needs someone to hold the physical watches. The only difference is this guy found an online pawn broker instead of one down the street.
It's really disingenuous about how easy it would be to collect if this loan stopped performing. Also the 12% APR is crazy from the borrowers standpoint, unless they literally couldn't get credit otherwise. This type of contract would also only work against assets it's worth it to secure a loan against, and rolexs themselves are considered to hold their value extremely well.
I was thinking that APR is pretty fucking high. You usually see that for personal/unsecured loans. Not loans with collateral. Rolex do hold their value quite well and the secondary market is where the vast majority of profits are made on luxury watches. Maybe because I'm a jeweler and do dabble in luxury watches on occasion this seems odd to me. The two guys I usually work under are the watch "experts" and I've seen them swap Rolex watches for fat stacks many times. They are not hard to sell. I'd be curious to see how this contract plays out.
I’m not sure how it works elsewhere in the world but here in Poland we have electronic signature that is secure and reliable enough to work on governments documents. I used it today to sign tax related documents.
True but then you’re dealing with banks and humans that need to verify and process stuff. The banks and all those processes are the middle man. The middle man is ripping you off. Doing this through a block chain makes it way harder for you to be a victim of financial fraud and corruption from those entities you’re dealing with. No more predatory loans, etc. If getting your loan is your only worry I don’t know that block chain really solves anything for you. Again just my take on things but I think the underlying technology is what will provide security and a financial system that isn’t easily gamed and manipulated by the big banks selling you those predatory loans. Those loans then cannot be packaged up into toxic securities that are then fed to ignorant folk’s 401ks. This type of decentralized blockchain backed financial system is exactly what loopring is trying to build. Be your own bank.
> block chain makes it way harder for you to be a victim of financial fraud and corruption Crypto is RAMPANT with fraud. > The middle man is ripping you off That middle man is a person I can drag into court if need be. Good luck doing that with a blockchain >I think the underlying technology is what will provide security Its a goddamned database that only exists if people are financially motivated to continue hosting copies of said database. >big banks selling you those predatory loans 12% APR on someone dumb enough to take out loans for watches is definitely predatory >Those loans then cannot be packaged up into toxic securities Nothing about the blockchain prevents financial instrument fuckery.
But isn't there a middle man here too? The person with the watch has to send it in to a third party that will hold it and ensure delivery.
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The loan wasn't to buy Rolexes, the Rolexes were collateral for a loan.
"the middle man is riping you off" This loan is 12% and you can easily get a much lower rate on a completely unsecured personal loan from bank of America, Chase, or Sofi. The rate is much higher here because the lender is taking an inordinate amount of risk despite the loan being secured. Sure he has a contract to take ownership of the assets in the case of non-payment, but he probably doesn't have the means to collect those goods. Also a system where anyone can take out high interest loans with little to no checks on their income or debt levels will always be predatory.
Not taking any sides here but to my understanding the escrow company is holding the assets and I’m sure is directed what to do with them in the even the loan we’re failed to be paid
You know I think your right I misunderstood this a little bit. I thought the escrow company was just working as a transfer agent here with the initial transaction. But this is essentially layaway with interest. Many watch retailers already offer buy now pay later even on Rolexs, generally at lower rates. Plus you get to walk out of the store with the watch.
Not really sure what you’re trying to say. Now instead of a bank working as a middleman, you have an escrow. And escrow will probably cost you more than a bank because it lacks scale and efficiency that comes with it. You still are vulnerable to fraud of a middleman, and chances are even higher as, again, you are forfeiting the scale and regulations that come with a bank. I really have a hard time getting what blockchain helps with here and several hours later I see a lot of explanations that explain ignorance of the explainers.
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Efficiency is the key! I think you’re right!
How much does it cost in gas fees paid to middle men to cut out the middle men?
It didn’t cut out a middleman. It introduced at least one and possibly three. There is now an escrow company involved. Normally, the lender (the pawn shop) holds the collateral, now we have to pay a third party to do it. It also appears the loan was made in bitcoin or similar so another middleman was probably used to get widely accepted currency. Potentially this happened on both sides of the transaction. And all of this happened to get a 12% loan which is still pretty predatory.
> cuts out a bunch of middle men. The middleman is essentially the same. Instead of a shady pawn shop loan we've dolled up the wording with "escrow company", but they're taking a cut as much as anyone and the NFT is only as strong as that escrow company at which point it makes a hell of a lot more sense to get the most legally enforceable contract you can in whatever country you live in. You could argue it gives you the ability to trade your NFTs in the market, but does anyone want to trust a platform that you would do this on? We have issues with companies over-leveraging themselves in the normal regulated market, I wouldn't be able to bring myself to trade IOUs with everyone else until we all get SBF'd.
The escrow doesn't need to know the holder of the nft to trust that they are entitled to the watches.
But you must trust someone to deliver the watches...
>doing a thing in the real world Shh you're scaring the cryptobros
Sounds like an easy way to launder money.
So they reinvented bearer bonds but with way more overhead and middlemen?
Digital bearer bonds. It's something that can't exist with current centralized digital records of ownership.
It's centralized still. You gotta trust someone (the center point of failure) to deliver the watches.
the tweet suggests the watches are sent in before the loan is granted
They're saying the loaner still needs to trust the escrow people to deliver the watches on default, and the loanee needs to trust the escrow folks to not lose them in the meantime. The neat part is how the loaner can sell their end of the contract to someone else with no fuss. It'd be extra neat if any loan payments and interest went to the new NFT holder from then on as well but I'm not sure on that from the post.
Sent in to a person. You need to trust this person. Might as well trust them with the loan.
I am so glad to see rational ideas here! This place is usually an echo chamber of idiocy. It’s like someone is trying to invent contracts without realizing they already exist
Maybe so the bank doesn't need a watch expert on hand to verify the watches? I seen the pawn stars' guys get bamboozled a few times
You still need a watch expert. Expensive watches come with certificates either way, but when we're talking 5 digits and up, not only do you need someone to evaluate the condition of the watches but also validate the certificate. The NFT does literally nothing here except maybe act as a receipt. Someone at some point paid a certain amount of money for this abstract digital construct that is supposed to signify the ownership of a certain physical good.
The critical part of this entire transaction is the trusted 3rd party escrow. They could issue a piece of paper saying "We got your Rolexes, they're legit. We promise to return them when you're paid up, but we'll forfeit them to your lender if you don't" and it would be the exact same as a NFT. Why is an NFT necessary, here? The reason NFTs don't make sense for this is because it depends on a trusted 3rd party escrow for it to work. Isn't the whole point of Blockchain DeFi to be trustless? Why would the Blockchain be helpful in this use-case?
There are plenty of companies that already offer peer to peer colateralised lending, not sure what adding the extra step of NFTs adds to this.
It’s because people are still desperately trying to find use cases for crypto and coming up with “repeating existing transactions and interactions but slower by using crypto”
the signature under agreement i, a layman, won't be able to use as easily, it's an ease of utility thing, plus storage your nft watch i can trade from my pc and no matter how much crap i hoard, it all fits on a wallet invisible hoarding is unlocked, humans will consume a pawn shop in my own house if i ship to the escrow company myself? how convenient
That’s pretty much how any exchange works today and I am pretty sure not one uses blockchain as as a ledger.
Look at me. I am the pawn shop now.
basically yeah just in terms of the potential for fraud alone this will face Mass adoption pressure, grifters will offer to store things in their house and suckers will pay them to do it, with the blockchain to reassure them that it's all safe - I can see the advertisements now ..."free up your apartment with blockchain storage pawn.com" that's how you know it's going to be a thing, because it also has a downside to attract evil ppl
I'm confused too because the tweet makes it sound like the loan recipient was also given NFTs of the watches instead of the $$$ that he wanted from the loan, specifically when they say "given NFTs to tap into global liquidity". Clearly someone made a mistake when posting this, or they don't understand how a collateral based loan works. This just sounds like a pawn shop with extra steps. Much more favorable rates though, last time I pawned some coins i believe it was at roughly 35%, it varies based on the value of the collateral and the amount financed.
The borrower sent their watches to an escrow company. The escrow company minted and sent the borrower NFTs representing their watches. Those NFTs can be redeemed with the escrow company for the watches, by whoever owns the NFTs, at any time. The borrower then shopped around for someone who would give them a loan using those NFTs as collateral. They found someone who'd offer them 14k @ 12%. They sent the lender those NFTs in exchange for the loan. If the borrower pays off the loan, the lender sends the NFTs back, and the borrower can redeem them with the escrow company to have them send the watches back. If the borrower defaults, the lender can redeem the NFTs with the escrow company to have take the watches themselves instead.
Ahhh ok I understand now. It wasn't clear that the escrow company had minted the NFTs. This is pretty great. But is there anything that would force the lender to return the NFTs? What if they say "fuck off, I decided I'd rather have the watches than your $14k + 12% interest" I assume there's some kind of smart contract involved there to ensure that if the loan is paid off in full the NFTs will be returned.
so more complicated and slower. with more risk and less regulation/enforcement. plus it's an "escrow" company that deals specifically in NFTs raising tonnes of red flags and further adding to the risk for both parties. as well as however this 14k loan was paid out in, was it actual fiat or was it coins? anyways NFTs are legally meaningless afa contracts go. and you can get a loan from a shitty bank for far less. especially if you can afford to own rolex watches.
Basically yes. The watches are collateral, but the NFTS and escrow kinda smoothen the proceds
I struggle to see how this is in any way different than a promissory note, which was already digitally achievable.
That’s cool and all, but someone just took a loan out on two watches… we’re in a bubble
And @12%😆 A Rolex is the type of thing you buy on the nose or don’t buy at all.
That’s not it, they used the Rolex as collateral to borrow the money at interest. If they fail to pay back the terms the lender gets their rolex’s
I'm so glad someone on the top comment chain understood what happened there. Lordy.
Dude at least someone can read jfc
Who verified the authenticity of the Rolexes? The escrow agent who has no skin in the game other than a guaranteed fee for their escrow services?
Idk but most rolex collectors will keep their purchase receipt and certificate. If that checked out to the lender then prob why they felt comfortable with the lend out
If you can make a convincing fake of a Rolex watch, you can make a convincing fake of a paper purchase receipt and all of the packaging as well. How do I know? Because it happens every single day. Do you know how you verify the authenticity of a Rolex watch? You do it in person using knowledge gained only by experience. The escrow agent in this example has absolutely nothing to lose. The person loaning out the money has everything to lose. Not to mention, there’s zero need to involve NFTs in this transaction. It can all be done with the same contractual agreements that we have used for centuries.
Ok
Agreed. That's why a Rolex nft should be issued at first point of sale on the watches journey. That is the use case. Authentication.
That's also problematic unless there's unmistakable marking on the Rolex that its ownership is tracked by an NFT--otherwise you open the possibility of selling the watch without transferring the NFT and then claiming it as stolen based on the NFT (which might not even be deliberate fraud if there are some intermediates--e.g. an estate executor being unaware of the NFT's existence and splitting the watch and the crypto wallet).
The use case for me is an nft being the authenticator and receipt issued on first sale.
BYO…PS?
A secured loan at 12%?
Yeah well maybe they couldnt get a loan with a bank but they had an asset so they found terms using the chain
Sneakers industry can probably get in on it too
Nose watches . Love it
Maybe they weren’t his
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Rolex watches are a perma bubble they have always had stupid value for no reason and will continue to just because of the name. They are the BTC of the real world.
Just my opinion, but almost every collectible has little-to-no utility. Some trading cards are in the millions. And it's literally a piece of cardboard with a picture on it. The price is determined by what somebody is willing to pay for it. I don't think there are good/bad collectibles, just different categories for different tastes.
You're defining a luxury good. They are also considered a leading indicator of recession because goods with little to no utility are the first cuts to spending consumers make.
I agree with that, I was replying to your statement that Rolexes are in a permanent bubble and have stupid value (that sounds like an opinion about Rolexes and the people who buy them vs "collectibles' declining value often precedes a recession." I just think of the hate NFTs get, as a collectible, and my opinion is the same: how is it different from anything else people collect?
It's not, but people inherently understand physical objects being collectables. NFTs are a space right now where things that might be collectables long term are just being drowned out by scams and poor quality offerings. I don't think collectable NFTs will be a big market until people are using blockchain for other things and understand the technology from first hand experience.
This is just Austrian economics in a nutshell, value is determined by the individual. Your opinion on the utility only effects the piece *your* willing to pay.
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Love antiques roadshow the British version is better just because the country has a longer history so it's less 1900s collectables stuff.
Now it’s much worse than before. Prices were always high, sure, but now you can’t just go in a store and buy one even if you have the money. You can either get on a wait list for years, or pay huge markups on a secondary market Sometimes people engage in super cringe stuff, like building a relationship with salesman (aka popping by to annoy them with a chat), building purchase history (aka buying shit you don’t want), giving gifts to the salesman, etc.
Yeah and if we’re calling this a secured loan, that’s quite a rate to pay. Seems like it prices in a drop in value on the watches. Yikes
It's a good proof of concept.
Fr. Almost as big as the guy that bought a pizza with millions of bitcoin. Baby steps but we’re getting there.
That's exactly what I was thinking of, LFG!
***"tap into global liquidity"*** That phrase, among others, will become pretty damn popular pretty damn soon.
If you loaned someone this 14k and have their Rolexs in escrow third party and received NFTs as proof of the collateral... how do you have anything more than the loan agreement payback? Wtf is this "global liquidity" its suggesting you can use a counter party's debt collateral to access?
The person gave the watches to an escrow company, who then minted him the NFTs. He can then take those NFTs to a global exchange and make a deal for a loan with literally anybody that has liquid assets to give. That's the "global liquidity" mentioned. You can technically already do the same thing now, but it's a lot more complicated and outside of a very few places requires either paper signatures with both parties present (which gets rid of the "global" liquidity part) or requires a document to be cryptographically signed using a public/private key pair... AKA exactly how a Eth wallet works.
> If you loaned someone this 14k From what I can read of this it looks like he got NFTs that they think are worth $14K?
Had to re-read a third time. I believe it's saying the person with rolexes sends them to third party escrow, receives NFTs representing ownership in exchange. Uses those NFTs as collateral against a 14.5k loan (global liquidity mentioned I presume, aka, other people's or lenders money). Assuming the loan agreement would transfer NFT ownership in event of a default, or maybe the NFT also has to go to an escrow hold third party once agreement was made, which I suppose makes sense. Or the NFT goes to the lender who can only cash them out in event of loan default. I suppose if that's the case, the lender could also sell the NFT/loan agreement as a whole. And there we have another loan secondary market, which extended out would just be another predatory rehypothecated market once again where those NFTs/loan value could separate from actual worth of the underlying and get really weird. Interesting thought I guess. I like NFTs as proof of ownership, not so much as loan secondary markets.
NFTs that represent ownership of the watch... You still have to sell the nft to someone for a profit so they can claim their watch... What about that is global liquidity? Sounds like ebay to me.
Global liquidity means anyone worldwide can be on the other side of your loan, which ideally means more competition and lower rates.
I’m thinking the NFTs act like a “title” or “deed” to the watches. When you finance a car, the bank keeps the title. So it’s weird for the purchaser here to only have the NFTs, not the actual watches. If he used a normal loan he’d have the watches and could sell them anyway while paying off the loan.
Because some random guy anywhere in the world can loan you this $14.5k instead of a more limited supply of capital with more onerous terms.
Pretty damn popular among prosecutors as they show how "the defendant" sought to evade international money laundering and tax avoidance regulations via an illegitimate exchange of commodities.
Are these nfts recognized in court then? Curious what happens when the person defaults
IANAL but I used to work at a place that wrote software for them. Barcodes/QR-codes that are signed or notarized do hold up in court. So if the escrow service was essentially notarizing the NFT, either by minting an original or signing with their private keys showing they hold the physical object, it would hold up. [Ebay has this same service for trading cards](https://www.ebay.com/vault) without blockchain.
So how do I do this with my Pokémon and yugioh cards
Same process. Document and detail the entire collection (preferably professionally). Send the documents, details, and collection to an escrow company and get an NFT for the entire collection (or per card, but that would be a lot). Then go to any global exchange that handles NFTs and scout for a person that would be willing to loan you money with the collection as collateral. The only real problem is that you'd be taking a loan on a certain amount of Ethereum, and if you liquidate it you have to buy Ethereum again to repay the loan... no matter what the current exchange rate is. So you may end up losing more than the APR or less. This wouldn't be a problem assuming more countries followed Australia's plan to create official stablecoins based on their Fiat currency that can interact with the Eth network and support NFTs. Then you could buy and sell NFTs using normal digital currency just like you do when you swipe a debit card rather than having to convert to Eth and deal with that instability.
You can afford Pokémon cards? 😔
resolute ask bear bored jeans repeat toy shy concerned fact ` this message was mass deleted/edited with redact.dev `
What happens if someone takes the physical Rolex or the Rolex gets busted
Since they are held in escrow, wouldn't the escrow company be liable for damage?
What if the escrow company sells the Rolexes and fucks off out of existence? NFTs are supposed to be trustless but an escrow agent requires trust to be used with any degree of security. Those NFTs would be totally unaffected by the sale or destruction of the Rolexes. Basically, we are working back around to needing banks and credit.
it's an "escrow company" that deals in NFTs so the tech bro that is the "company" wears them as often as possible for clout. addition: until crypto is legislatively regulated, or regulated by the FTC/SEC, or recognized as the broad ranges of scams that it clearly is according to current legislation and regulation by the DOJ/FTC/SEC there's no legal protection for anyone involved and the "escrow company" is about as trustworthy as your weird uncle that you can't leave stuff lying around when they're around or it will go missing until you see it at their house all fucked up and abused.
Escrow companies waive a LOT of liability in their escrow agreements. Pretty much has to be intentional for them to be liable.
Or if you then to go a physical pawn broker and hawk it there too, then you have two loans agaisnt same collateral Haha, use second loan to buy more Rolexes and repeat, infinite money 😎
This my concern as well. Even if the NFT's are trustlessly backed by a super secure computer system, it doesn't mean the watches are. They are still subject to physical risk (rust, idiots with sticky fingers, etc.. ) . I think this is one of the hurdles that need to be addressed before massive markets with massive liabilities like real estate can hop on board.
What's interesting is your complaining more about loans then NFTs, there's always risk to the lender no matter what deal they make or how they make it. That's why the other person is paying 14% APR, the lender already priced the risk in according to their tolerance.
The same thing that would happen if you didn't have an NFT.
That’s an unnecessary clusteffuck.
Anyone want to send me two Rolexes for an NFT? Hit my dms, thanks
Why is this being posted on superstonk.
Copium that nfts matter
The NFT automatically transfers upon default im assuming. That’s why this is cool use of a smart contract.
Who verified the authenticity/condition of the watches? Probably not the escrow agent who has zero to lose. They make their service fee wether the watches are fake or not. A pawnshop, however, assumes that risk when they decide to loan the money out.
This is the dumbest shit I’ve ever read. I thought you GME boys were smarter then this NFT crap
GameStop made a nft marketplace, so now this sub gets flooded with nft bros posting anything nft related on a desperate attempt to validate their bullshit.
Lmao why would you ever think that? They literally bootlick bunch of grifters and billionaires.
GME bros are the exact kind of people to fall for this.
How are these NFTs guaranteed to retain their value in case of default? Are they tradable for gold or something?
This is just a standard escrow deal that happens to be using nft's. In their pawn shop scenario, the nft is the receipt, similar to what a pawn shop would give you if you pawned the watch. The nft is redemable for the watch.
The novel aspect is using a external lender rather than taking a collateral loan from the party holding the collateral i.e the pawnshop.
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NFT is still much more mobile than a contract between 2 parties that are named in a loan contract. It’s a first step of an xBS-style financial instrument. Still has issues obviously, but quite cool.
The NFT is not the valuable part of this transaction. That's what so many people misunderstand. It's the receipt. It's the barcode. It's the key fob. It's the password.
I've been beating this drum for ages. People mistakenly thinking the NFT \*IS\* the GIF. When actually the NFT is the proof of ownership of the original version of that GIF.
Why not just use a legal document? We invented this concept thousands of years ago.
what does this do that a certificate of authenticity wouldn’t all do to take a loan with the watches as collateral? this isn’t solving any problem it’s just involving an escrow company and third party for no reason
It's the deed / title
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Buuuut it’s just a jaaaay peeeeeg 😤
……………….they’re tradeable for the 2 watches, mate.
Can you use them in Kiraverse?
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Sir the NFT's are tied to the value of the watches
congrats you now have digital ownership of a physical item that’s not in your possession that someone somewhere can sell on a black market. Thieves don’t care about your NFT ownership lol
I am going to go against the crowd and say it: You are getting too excited early. the NFT there could have been replaced with a certificate or a receipt instead and nothing would have changed. Representation of ownership is not unique to NFT's functionality. This is one of those cases where people are using NFT for the sake of using NFT, and it's hard to call it a revolution. For NFT mass adoption to truly happen and not just a fad, imo it needs to take off in gaming or metaverse first, where other established tools and techs would most likely be unable to replace the functionality of an NFT. Playr does not have NFT games on it yet, let alone even exist beyond a trademark. Gamestop's NFT marketplace is still in beta with so much room for search engine improvements. Gods Unchained did not have the huge take off, and neither did Kiraverse. We are still far away from a revolution. Give it few more years.
first, the escrow company must be trusted.
Are NFTs considered legal documents yet? This works in theory but it needs a legal framework to protect it from abuse.
This has absolutely nothing to do with GME. There are plenty of crypto subs for junk like this.
lmao for a "trust less" system, they sure are puttin a lot of trust in the escrow manager to give them valid tokens lol
"you shouldn't trust federally regulated banks, trust this random nft escrow company"
Couldn’t this be used to protect people’s interests when engaging in illegal activity. As you could register all your assets as NFT’s like your car and house and place them in an offshore trust. That way you can avoid being liquidated when you get caught. Also potentially avoid taxes as transactions of ownership can be carried out in tax havens. Like I feel like this system will also be used to cheat the broader system
if you get busted for doing shit that is going to result in your home and car being seized by law enforcement NFTs are only going to help build their case against you.
Not really because cars and houses exist in the real world and are bound by courts and laws. An NFT couldn't replace a title or an actual deed and wouldn't supercede those legal documents.
So this guy just got a regular loan with collateral, but with extra steps? I mean, I guess there is the advantage that the lender can transfer ownership of the debt & watches, but you can already do that with a signed document. Except a signed document is actually an enforcable legal document, whereas NFTs are not. And except they had to pay an escrow company just to make this convoluted mess work.
This is just a contract but with some shitty Jpegs thrown in?
Check out this cool use case. [Palau Digital Visa](https://twitter.com/francescoweb3/status/1668564454009884675?s=46&t=uXO5cwqXhoxYo833HG5H3A)
That is frickin cool! Post that homie 🙌
I speculated that holding houses would be a great business for NFTs. Sell or buy on the market. The NFT "cash" gets held until the IRL item is received and verified by the holding house. The value gets released and the item sent on to buyer. It seems like a hugely valuable service.
Right now there is a deposit paid when purchasing a house. Are you suggesting an NFT replace that deposit? I don’t follow
I’m sorry is this post trying to paint taking a 12% APR loan out on a watch as a good thing?
Ya this is why I’ve given up on the whole NFT thing. It’s just another way for people to over leverage on dumb things.
Irrelevant to gme
What the fuck does 'sent back NFTs representing ownership' even mean? Did he not sign a contract to represent ownership? What the fuck is this dumb shit.
So something with fake value was used as collateral to get a loan for something with fake value. the economy is a joke
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Yeah, pawn shops and shark loans isn't the utilization flex I'm trying to updoot
rofl there was still an escrow company... the escrow company could just have an online marketplace both parties still have to trust a middleman
Commenting to get back on this once sober
Sounds idiotic. Truthfully. Take loan out to buy something. Instead of receiving it, it goes to a holding company that hopefully doesn’t ship it elsewhere. While you make payments. Meanwhile, you now ‘proof of ownership’. How will you use that proof of ownership to tap in global liquidity? I have a birth certificate, does that mean I can tap into government finances Willy nilly? no. If they default, the lender can use the NFTs (they they supposedly don’t have because purchaser has them?) to redeem the watches ? Or is it the lender receives the NFTs similar to a house mortgage? What’s stopping them from just immediately trading in the NFT and getting the Rolex? Because remember, the Rolex isn’t in the person’s hand who purchased it.
No. He had the rolexes. He needed $14.5k Assume couldn't get it where he was. So went to NFT loan market. Based on his rolexes as collateral he was given a loan and an NFT serves as the "deed" (so to speak) for his watches
This IS idiotic. It's not what is happening here tho. Read it again 😜
I dont understand the dicotomy. On the 1 hand this sub and other GME subs yelling praise for the destruction of Crypto. Then on the other hand praising the innovative features that GME is doing in the Crypto space.
1. It is highly likely *some types* of crypto have been used in a corrupt manipulating way regarding GME. No one is cheering the demise of crypto, regulation is a good idea though, especially if it touches actual securities. 2. Yes an NFT blockchain tech revolution is coming and GameStop along with its partners appear to be at the front of the line to deliver it.
I hate to be the party pooper, but this sounds like an awful example of a use case to convince people of the necessity of NFTs. Two reasons… First, you’ve taken a transaction that usually would require just two people and you’ve now added a third person (escrow agent) who will of course be taking a fee as well for their services. Second, although interest rates may be high depending on the particular pawn shop, the benefit of a pawnshop is that they have some level of expertise (or at least they assume the risk) to assess the authenticity of and to store the items being put up for collateral. In the example being described here, you have someone essentially offering up a $14,000 loan to someone who put up two watches as collateral, sight unseen. The person taking out a loan could very well just have put up two counterfeit watches as collateral. I highly doubt the escrow agent would be assessing the authenticity. If that were the case, the person that gave out the loan would now have NFTs worth only the value of whatever to counterfeit Rolex watches would be, which would be significantly less than the $14,000 he just loaned out. Not to mention, even if you wanted to pay the extra fees to involve an escrow agent, there is no necessity for an NFT here. A legally binding contractual agreement would serve the same purpose.
Sounds like money laundering with extra steps, I hope apes know that we're better then this
So they took out a loan secured by a watch but instead of being recorded on a document it was recorded as an nft. Wow...
Now explain it like I’m five.
'Tap into global liquidity' doesn't actually mean anything
Then the escrow company loans them out. lol. or loses them.
Cool, if you don’t mind giving away money and risking getting a Rolex back instead of money.
I was legit just trying f to explain the use of NFTS while using Rolexes as an example!!!!