The NFTs process summary within the JOLTIFY network
There is a legal preparation for the sale of a loan using NFT. This is required as we need the sale of this NFT, to also be legally binding and the new owner to be validated and verified. For example, if the NFT was purchased within the real estate industry, we will need real world conveyances to have the transaction validated. If we didn't have this, the NFT would merely be in the crypto, DeFi world, but not validated in the real world and the NFT would be rendered meaningless.
The loan is minted, and this should include the descriptive and legal data about the loan. This includes all image files, reports, disclosures, payments, payment schedules and all other paperwork.
The NFT becomes the proof of the ownership.
Legally, whoever is named in the NFT and has possession of it, owns the loan and becomes the lender.
The NFT is placed on JOLTIFY pools for investors.
A potential investor who is interested in this loan will buy the according NFT using stable cryptocurrency coins like DAI, USDC through a smart contract. After the funds are released to the seller, The NFT is transferred to a digital wallet controlled by the buyer.
During the loan life period, the NFT owner who is also the lender receives the repayment from the lendee at a set time.
At the maturity date of the loan, the lendee pays back the whole loan and the NFT will be transferred back from the lender to the lendee where it can be burned.
A special scenario in the NFT ownership transfer
During the loans' life cycle, there is a special need when one lender wants to sell the loan ownership while some other investor wants to invest in the loan. We create a market time for a specific requirement referred to as "Window".
Before the window opens, both the buyer and seller register their interest in the pool. The orders will be locked. When the window opens, these orders will be processed and executed at the same time in this order:
The sellers redeem the existing NFTs back to the lender on a pro rata ratio to the buyers' order.
The Special Purpose Vehicle (SPV) issues the new NFTs to the buyers.
The buyers stable coins are transferred to the sellers.