NFT Rentals: The Next Step in Play-to-Earn Games
In October 2021, crypto industry watchers scratched their heads when a collection of venture capital firms bet millions of dollars on reNFT, a decentralized autonomous organization (DAO) that helped people rent NFTs on the Ethereum mainnet.
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That was almost a year ago, and today the NFT rental market is emerging as the next big thing in the blockchain world – and play-to-earn (P2E) is at the heart of it all.
Who might want to rent an NFT and why?
Some NFTs come with exclusive benefits, and reNFT enables owners to monetize these benefits without selling their NFTs, kind of like blockchain’s version of Airbnb.
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When reNFT went shopping for VC funding, it had a shining example of success to show potential investors. It had just facilitated the lending of the NFT collection Stoner Cats. Stoner Cat’s NFTs give their owners access to an exclusive library of video shorts produced by actress Mila Kunis.
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Borrowers wanted Stoner Cats NFTs long enough to watch the videos, but they may not have the means or desire to own a Stoner Cats NFT outright. The owners wanted to make money from the NFTs and the content they unlocked, but they didn’t want to lose them forever by selling them.
reNFT bridged this gap – and investors saw dollar signs.
Like renting an Airbnb that you can never afford to buy
The NFTs that represent membership in the most exclusive NFT communities are far beyond the reach of the average person. Cryptopunk and Bored Ape NFTs routinely sell for hundreds of thousands or even millions of dollars.
According to Jumpstart, the NFT rental concept gives ordinary people the opportunity to experience life in the NFT 1% — but only for a while.
Like newlyweds splurging on renting a honeymoon mansion on Airbnb that they couldn’t possibly afford to own, ordinary blockchain enthusiasts can gain temporary access to the industry’s hottest assets via the NFT rental marketplace. Without the rental concept, that world would be far out of reach.
So, where does Blockchain Gaming come in?
P2E games are created on the blockchain and connected to a digital economy. When players add value to the game, they are rewarded with game resources that they collect as NFTs.
Most games require players to purchase NFT resources to start playing and earning. Buying the necessary NFTs can be prohibitive – sometimes thousands of dollars. Many players want to participate, but simply do not have the money to buy the necessary NFTs for startup.
This is where the rental market comes in.
According to BeInCrypto, established P2E players can earn passive income by renting out their NFTs to aspiring players. Not only do they collect the fees they charge for rentals, but they also get a cut of the borrowers’ gambling winnings.
What exactly are they renting?
BeInCrypto identified the two asset classes that P2E players are most likely to rent. The first are digital plots of land in the game itself or in the metaverse. “Landlords” who are heavily invested in digital real estate can rent out land and housing to players who need a base of operations in their games.
The second type of rental is for in-game items – things like characters, skins, weapons, pets, gear, and tools. By renting items like these, players are better equipped to make money while raiding, fighting or farming – which of course goes to the NFT lender.
Same as in the physical world, renters pay and owners get rich
While NFT rentals, P2E gaming and blockchain technology are foreign to most in the mainstream, a story familiar to just about everyone is playing out.
According to Fortune, NFT rentals are supercharging P2E gaming, providing access to players who otherwise wouldn’t be able to afford to get a foot in the door. Along the way, NFT lessors and lenders get rich with a steady new stream of passive income. The players who can’t come up with the thousands of dollars needed to start playing, on the other hand, are usually left with just a sliver of their earnings after paying back the lenders.
On the blockchain, as in life, it pays to be the one who carries out the lending. The loan, not so much.
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