Need a Loan on Your Sandbox LAND? — New Partnership Between Zharta and MGH Will Make That Possible
Your LAND in The Sandbox.
You’ve spent hours designing it — you built houses, sprinkled it with trees, populated it with figurines… And now you have no choice but to sell it. Because you desperately need money.
But do you really have to? Isn’t there some way to hold on to your valuable LAND for the long term and still be liquid in the short term?
Soon, there will be.
The new collaboration between Zharta and MGH (MetaGameHub DAO) will make that possible. Together, we’re working to make it so you can take a loan on your LAND (Sandbox and Decentraland) — as if you were borrowing on your portfolio on Aave.
You’ll find out more about this project and its implementation in a moment. But first, who is our valued partner Zharta?
Who is Zharta? — Making Collateralized NFT Loans possible
With DeFi, you don’t have to sell anything anymore.
If you need money urgently, you can just go to Aave or Maker and borrow against your portfolio. Or you can get a loan that pays itself back through Alchemix.
But with NFTs?
Until now, you had no choice but to sell. The collection you painstakingly assembled… your treasured pictures.
But those who have to sell get horrible prices. Ten ether becomes five, four, three… until someone finally shows them mercy.
Zharta wants to change that.
Zharta is a Lisbon-based platform that connects DeFi and NFTs. How? By offering real-time, non-custodial collateralized loans for NFTs — loans secured by an NFT.
Let’s say you want to take a loan on your Twitter profile picture, a Board Ape. To do this, you deposit your NFT as collateral in a smart contract from Zharta and automatically receive a fixed sum payment.
Zharta has also opened the door for investors who want exposure to the NFT market by facilitating a simplified investment experience through lending pools that provide liquidity to the ecosystem.
And now Zharta and MGH want to bring this revolution in DeFi and NFTs to the metaverse lands:
How to Get a Loan on Your LAND — Easily
What can you do in the real world if you’re badly in need of money? You could take out a second loan on your home, called a home equity loan. This is where you borrow against the part of your house that’s already paid off.
With the help of Zharta and MGH, you’ll soon be able to do something similar — only you won’t be borrowing on real-world land, but digital LAND on the blockchain.
You deposit LAND — from The Sandbox or Decentraland — as collateral and get paid a certain amount.
But how do we determine the value of your NFT? After all, NFT prices are hectic; the market is often illiquid. And even assuming we’re able to evaluate your NFT fairly, how do we get it on the blockchain?
We’re glad you asked:
1. Get a Fair Price for Your Land via MGH’s NFT Algorithm
One look at CoinMarketCap is all it takes. You instantly know the price of Ether — and you can take out a loan on it.
This is more difficult with NFTs. The market is not very liquid. Prices are erratic.
MGH has solved this problem via a unique AI-driven algorithm that was developed with help of our strong partner, ITRM, to automatically determine the fair value of your LAND.
To do this, the algorithm analyzes thousands of NFT sales and combines them with specific metrics — like the base price of the collection, 7-day average sale price, crowdsourced value appraisal, and other metrics from real estate valuation.
From this enormous pool of data, combined with machine learning, it finally calculates the estimated fair value.
Zharta then uses this value to ensure you’re paid a fair loan. And just like that, you’re liquid.
(Curious? Try the algorithm for free in our dApp and evaluate your Sandbox LAND immediately).
But wait a second — the algorithm is not on the blockchain. So how do we get the data on-chain so that Zharta can use it?
2. How to get Your NFT Valuation Data on-chain
The “real” world and the blockchain are like two lakes separated by a dam. There is no connection…unless you open the floodgates.
These floodgates are oracles: they send data from the “real” world into the blockchain and back.
To bring NFT price data to the blockchain, MGH has partnered with Chainlink — the most established Oracle ecosystem at the time of writing. Thereby, MGH has launched its own Chainlink Node, which will bring the data to the blockchain via an API — and thus also to protocols such as Zharta.
And so, you can put your LAND in a Smart Contract from Zharta and get instant credit. Without headaches. Without selling.
Zharta is also working on valuation mechanisms that correlate with MGH prices, with an aim towards building an oracle where price discovery is also more decentralized.
That’s not all — Zharta and MGH have more in store. Not only will you be able to borrow on your land, but also stake it at the same time:
3. An NFT Pool with Zharta
On March 1, MGH will launch its first NFT pool. What does this mean?
From this moment on you can stake your Sandbox LAND in an NFT pool to mint NPTs — so-called NFT pool tokens.
Think of them as price trackers of the entire NFT pool: if it goes up in value, so does your NPT and vice versa.
You can do more than just hold these NPTs and profit from them when they rise in value, however. You can also add them as liquidity in the NPT/MGH pool.
For your tokens, you get a Liquidity Provider Token (your right to your shares of the pool), which, in turn, you can stake. What this means for you: passively earning network rewards from staking your NFT.
We also want to set up such an NFT pool with Zharta. It should contain the NFTs that were deposited as collateral. This way it could be possible to not only borrow on your NFTs but also to stake them at the same time.
These are our plans for the future, however. Points 1 and 2 have priority and will be rolled out much earlier.
About MGH — Simplifying NFT Investing
MetaGameHub is a DAO with the goal of making NFTs accessible to everyone — and as simple as possible.
We can do this by solving the most pressing problems of the NFT market:
- Illiquidity: It can take weeks for a seller to find a buyer. Through NFT Pool Tokens (NPTs), anyone can participate in the broad NFT market(from as little as $1) and sell the token at any time.
- No diversification: Only millionaires can diversify sustainably across high-quality NFTs. For most, diversification in the NFT market is prohibitively expensive. However, if you hold NPTs, you are automatically diversified across an entire NFT sector (like LANDs) and benefit from the huge upside.
- Intransparency: It is almost impossible to find a fair price for your NFT. The Data is scattered or completely missing, and the market is illiquid and emotional. The solution is our NFT Price Oracle, which determines the fair value of your NFT — using price data, sentiment data from social media, and machine learning.
How Can You Stay up to Date and Keep in Touch with MGH?
● If you want more information about MGH, visit our Website
● For a sharpshooter-like view over the whole project, read our Whitepaper.
● Follow us on Twitter.
● Follow us on Instagram
● Check out MGH on LinkedIn.
● Discuss, write, and celebrate with us on Telegram.
● Talk, laugh, and have a good time on Discord.