Why Hedge Your NFT
Incentives
Earn While You Hold: By holding a hedged NFT you earn Loop points while it remains in your possession.
SOL-Based Rewards: The hedged SOL accumulates rewards over time via LST and LRT, allowing you to generate passive income even when market conditions are uncertain.
Flexibility in Adjusting Your Hedge
Modify Hedge Amounts: The protocol allows you to increase the amount of SOL you’ve hedged at any time. If the value of your NFT appreciates, you can add more SOL to your hedge to further protect your investment.
Hedge Lock: Hedge Loop gives you the flexibility to decide how long you want to hedge your NFT either for a period or indefinitely. This lets you customize the hedge based on your market outlook.
Avoid Liquidation of Your NFT
Maintain Ownership: Hedging your NFT doesn’t require you to sell or stake it. You retain full ownership and control of your NFT while still protecting its value with a SOL hedge.
No Need to Sell in a Bear Market: If the NFT market is down, rather than selling your NFT at a low price, you can hedge it to preserve its value in SOL, waiting for the right time to sell.
Improved Risk Management
Diversify Your Portfolio: If your portfolio consists of NFTs that are tied to volatile market conditions, hedging allows you to diversify your risk by securing part of the value in SOL, a more liquid and stable asset.
Minimize Losses: In case the NFT market experiences a downturn, hedging your NFT provides a safety net, ensuring that you won’t lose everything if the value drops significantly.
Liquidity Without Selling Your NFT
Access to Funds: If you need liquidity but don’t want to sell your NFT, hedging allows you to unlock funds in SOL. The hedged amount is stored in the protocol and can be withdrawn when necessary.
Flexible Access: You can increase or decrease the SOL hedge, enabling you to manage your liquidity needs without the need to sell your asset.
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