1. A borrower selects an NFT and the terms (currency, value, APR, duration) of the loan they desire.
2. Approve the terms and sign over the asset so the details are posted to Liqd.
3. A lender sees the asset on Liqd and either:
a. Likes the terms of the loan and sends the requested funds to Escrow (removing the assets from their wallet), which also triggers the NFT to be removed from the borrower’s wallet (it is now held in Escrow as described above)
b. Doesn’t like the terms and suggests a different set of value, duration, and APR via the “Make an Offer” functionality at which point the Borrower will be notified of the offer and must accept or reject it. If accepted: the assets are moved as above in regard to Escrow. If rejected: the original terms the borrower requested are still listed on the Liqd site.
4. Once the assets are in Escrow, the NFT stays there for the duration of the loan. The funds provided by the lender for the loan are deposited in the borrowers account.
5.
a. If the loan is intended to be repaid (with interest) prior to the expiration of the loan terms: the borrower should navigate to the asset and select “Repay loan” (which can also be found in the “My Loans” section of the dropdown menu in the upper right hand corner of the Liqd site). The borrower must allow the spending of those assets and approve the transaction to repay the loan. At this point, the borrower will have their NFT Asset returned from Escrow and the Lender will have their crypto (with interest) returned as well. Please be sure to have sufficient funds to pay for gas in multiple transactions and leave sufficient time to fulfill the loan.
b. If the loan (with interest) are NOT repaid prior to the expiration of the loan terms: The borrower forfeits their assets (still held in escrow) and the lender is able to “liquidate” the loan by selecting it in their “My Loans” section. By liquidating the loan, the lender is able to remove the NFT asset from escrow and take full ownership of it.
6. At this point a new lending sequence can be initiated as only one loan per asset can be undertaken at any time.
