After many ignored loan offers, I am resorting to a desperate strategy just to try and get some more traction going. I am looking at .eth names that are both listed for sale at a fixed price on a marketplace like ENS Vision that are simultaneously being proposed as collateral on an NFT lending platform like Teller. I am then offering a loan amount that exceeds the list price. This makes little financial sense to do but here’s the rationale:
Since these names have reasonable buy-it-now prices, it’s a signal that the owner actually wants to sell the name. Therefore if they accept a loan amount that exceeds the list price, the obvious move is to just default and walk away with the funds and let the lender liquidate the name that is now overpaid for. Given that I’m the lender in this situation, what I’m doing is exceptionally dumb, but doing this has brought awareness to something I wouldn’t have expected.
If a seller lists a name with a Buy-it-Now price of $100, the trade executes immediately when a buyer agrees to the listed terms. Consequently if that same name receives a loan offer of $150, one would think that it would also execute immediately because a default would produce the same outcome as a sale but reward the borrower with an even higher sales price. But this isn’t what’s happening. Instead, my overgenerous loan offers have received no response in the hours since I’ve made them. In crypto, where smart contracts and immediate gratification set the tone for speed, it’s painful to have to wait and see (1) if the potential borrower will even know that the loan offer has been made (2) they will understand the lopsided economics in their favor and execute it.
And so I wait…