The Index offers a non-custodial, market-cap-weighted NFT index and algorithmic lending protocol, enabling instant NFT sales, NFT-backed loans, and a yield-bearing NFT index token. Fungify addresses the challenges at the intersection of NFTs and DeFi with its elegant primitives.
The 🔓MarketVault primitive automates liquidity provisioning for NFT holders, supporting outright sales or using NFTs as loan collateral. It allows permissionless NFT ingestion, creating a peer-to-contract marketplace and guaranteeing liquidation counterparties. An algorithmic interest rate control mechanism stabilizes liquidity demand and supply.
A key innovation is the decentralized 🖼️NFT Index Token ($NFT), which provides exposure to a curated set of NFTs and yields from borrowers. Fully backed and redeemable for NFTs in the MarketVault, $NFT mitigates individual NFT illiquidity and is pegged to the broader market via arbitrage. Using $NFT as a loan unit of account reduces volatility and aligns risk parameters with the market.
These components unlock ecosystem liquidity, seamlessly integrating NFT and DeFi functionalities.