NFT Renting: A New Monetization Model for the Metaverse with IQ Protocol
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NFT games are taking the Play2Earn concept towards a whole new level. In many conventional games, players earn points and items by achieving various milestones. However, players don’t truly own these items as they are just virtual representations controlled by the game developer. Oftentimes, these items and points are worthless outside the game’s ecosystem. NFT gaming is flipping that completely - players can now play to earn NFTs and in-game items that have transferable value outside of the game. This allows players to freely exchange their hard-earned NFTs with other players or with crypto, and ultimately to cash in the real world.

Simply put, NFTs are digital assets that come in many forms, including memes, GIFs, artwork, in-game purchases and even virtual land. Several companies, such as Decentraland, Wanakafarm and Sandbox, have now opened up the possibilities of owning real estate virtually, allowing gamers and even investors to own land in a game.

A patch of virtual land in the Decentraland was sold for over US$900,000. Blockchain-based real estate in virtual worlds is now surging in price as the NFT craze increases. While this typically means profit for land NFT owners, most still don’t want to sell their assets. Land owners hence look for new ways to earn profit without having to sell their NFT land.

Introducing PARSIQ’s IQ Protocol, a DeFi protocol that allows game developers to offer more monetization options to NFT land owners. In addition, it will enable game developers to open a renting protocol, where NFT owners can rent their virtual land and enjoy passive income without needing to sell the land itself.

Here’s how IQ Protocol innovates the land NFT ecosystem:

  • Risk-free lending of land to others. With IQ Protocol, game developers can create a renting pool allowing players to put their lands up for rent and earn passive income risk-free. Instead of simply owning land and holding the NFT, owners can rent it out to other gamers and allow them to use the land for a rent fee. Choose daily, monthly or whatever renting model you’d like, just like in real life. IQ Protocol’s sophisticated smart contracts ensure that your rent terms are trustlessly executed. No risk of renters defaulting or having to chase down payment.
  • Earn yields and rent fee. Landowners will earn yield and rent fees via smart contracts, allowing them to have peace of mind that their investment is secure. At the same time, owners can set predetermined conditions, depending on what has been agreed with the renter and the smart contract will execute it automatically, depending on that agreement. For example, owners can set custom logic, rent terms and rent expiry on it so that everything will settle automatically, and there is no need for any manual process or human intermediary. These smart contracts ensure correct, timely and absolutely transparent rent management so you can focus on the fun aspects of the game.
  • Multiple monetization streams. Game developers can now attract more investors by offering to rent land as a new way to profit from land NFTs. Apart from simply buying and holding the land, investors can also take advantage of the renting pool to earn passive income while waiting for the right moment to sell. As the game ecosystem grows, landowners can also implement other income streams such as taxes, land insurance and so on. The player’s and game developer’s imaginations are the only limit.
  • Attract more gamers through lower barriers to entry. Some NFT games require users to buy an NFT before they can play it. Unfortunately, not all gamers have the capital to do so. With IQ Protocol, gamers can now rent NFTs for a lower price so that they can play the game without needing to spend a substantial amount upfront. NFTs can be rented for a fixed duration, allowing players to possibly earn enough to continue playing when they return the borrowed NFT. As a result, game developers will attract more gamers and ensure fairness for newcomers. Meanwhile this creates more renting demand for NFT owners to create a positive feedback loop.

One of the most common problems faced by NFT games is that they have more investors buying NFTs rather than gamers who actually want to play the game. This negates the idea of gaming, which isn't an ideal scenario for the NFT gaming ecosystem either. With IQ Protocol, game developers can now attract more players through innovative renting systems. What this ultimately means is a circular economy that promotes healthy game economics.

Imagine how powerful NFT renting can be when people build virtual houses, amusement parks, shops and more (all NFTs on their own) on top of land. IQ allows you to track all of this with smart contracts and make innovative economic incentives scalable, fair and trackable in the NFT gaming world. Welcome to the metaverse!

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