The NFT wave seems to be unstoppable. NFTs have spread their wings across many fields. NFTs have helped several fields like gaming, fashion, art, etc. From ticketing concerts or events to having a special experience at a famous restaurant, NFTs have literally opened up for many industries and consumers to get access to exclusive experiences. If we take the gaming industry in particular, NFTs have enabled a new model of gaming called Play-to-earn games. Though gamers have found comfort in the traditional games, the play-to-earn games have attracted a new set of audiences.
In this blog, let’s look at how some of the new developments in the NFT Gaming Marketplace have impacted the gaming ecosystem.
The NFT wave seems impossible to halt. They have branched out into a variety of industries.
NFTs have benefited several industries, including gaming, fashion, and the arts. Additionally they have figuratively thrown open the doors for various sectors of the economy and consumers to have access to exclusive experiences, from purchasing concert or event tickets to enjoying a memorable meal at a renowned restaurant. If we focus on the gaming sector specifically, NFTs have made it possible for a new gaming model known as play-to-earn games. Despite the comfort that traditional games provide for players, play-to-earn games have drawn in a whole new group of players.
Let’s examine how the gaming ecosystem has been impact by some recent events in the NFT field in this article.
NFT Rental Standards- ERC-4907
There are several NFT standards on a different blockchain. The new ERC-4907 ( Rental Standard) recently came into existence after passing the review by the Ethereum development team. ERC-4907 is the 30th ERC standard. With ERC-4907, renting of NFTs have been made possible. Let’s deep dive into this and understand what this really means.
ERC-4907 lets the owner of an NFT to rent their NFTs to another person for a particular period of time. After the stipulated period is over, the person does not have authority over the asset. The original owner still holds the ownership. On a different blockchain, there are various NFT standards. The Ethereum development team recently approved the creation of the new ERC-4907 (Rental Standard) after reviewing it. The 30th ERC standard is ERC-4907. NFT rentals are now feasible thanks to ERC-4907. Let’s examine this closely to determine its true significance.
According to ERC-4907, an NFT’s owner is permitted to lease their NFTs to a third party for a set amount of time. The person loses control of the asset after the predetermined time period is up. The property is still owned by the original owner.
NFT Rentals are not a complicated concept to understand. They work the same way as other rental systems work. For example, if you want a bike for a trip and you don’t own one, buying a new bike wouldn’t be a feasible option. Thus, the most conducive decision is to rent a bike for a particular period of time. After your trip is over, the ownership goes back to the original owner.
This is exactly how rentals work. Moreover, You rent a particular NFT for a certain period of time and return the NFTs back to the rightful owner after the renting period is over.
Understanding NFT Rentals is not a difficult idea. They operate in a similar manner to other rental schemes. Purchasing a new bike wouldn’t be an option, for instance, if you needed a bike for a vacation but don’t already have one. Renting a bike for a set amount of time is therefore the best option. The ownership returns to the original owner after your journey is ended.
Renting works exactly like this. A certain NFT is rented for a predetermined amount of time, after which the NFT is given back to its original owner.
Types of NFT Rental
Collateralized Renting and Collateral free renting
Currently, there are two types of rentals. Collateral and the Collateral free renting. In both these methods, the owner will transfer the NFT to the user with some conditions or Collateral to make sure that the user will return the NFT after use. The current rental process is quite risky because the original owner of their NFT will lose their ownership once they rent it out to other users. This also means that there’s a high risk involved while the NFT from NFT Marketplace is in the rental period.
Furthermore, the reclaiming process is complicated and expensive. These disadvantages can now be avoided with the introduction of ERC-4907. In accordance with the rental standards, the role of the owner and the renter is different and comes with an expiry date. This means that the NFT will go to the original owner after the expiration date. The renters’ privileges come to an end; no in-chain activity can be carried out after the expiry date.
Benefits of renting
1.NFT renting comes with a lot of benefits. Both the owner and the renters benefit from rentals.
2.The rental system has encouraged more people to explore NFTs. The renters who wouldn’t otherwise get an opportunity to get their hands on NFTs will now be able to explore the advantages of NFTs.
3.The owners have the benefit of earning a passive income through renting their NFTs. This is not only an effective way to monetize their NFTs that would sit in their wallets unused.
4.NFT rentals are majorly going to be effective for the gaming, real estate, and art industry. From Digital art, decors, or illustration to virtual lands and spaces, rentals are a great boon to the Metaverse.
How have the Rental Standards impacted the Play-to-earn NFT games?
NFTs have given rise to the development of a new model of gaming called Play-to- earn games. This means that the players get to play and earn at the same time. The players will earn in cryptocurrency. The in-game assets in these games will be NFTs, which anyone can buy and trade in the same gaming NFT marketplace or other platforms.
The new rental standards have had a huge impact on play-to-earn games. To be precise, NFT gaming is going to benefit the most through the rental standards. The NFT rental services for P2E games have become more accessible to many gamers. For example, if you need a certain weapon or card to level up in the game, and if you don’t have enough resources to buy it, then renting would be the best option.
The gamer can rent the weapon or card from the person owning that particular NFT that he needs. Additionally, Gamers who have rented an NFT can have full claim over the profits earned from it. The original owners will get a passive source of income by renting the NFTs.
Many NFT gaming platforms are striving to make NFT games more accessible and feasible because NFTs are definitely not something that one can miss out. The play-to-earn games have the potential to expand beyond their boundaries and bring more profits to the players. The new ERC-4907 Rental standards are undoubtedly going to encourage more gamers to take the P2E game route.
Since NFTs are unquestionably something that cannot be overlook, numerous NFT gaming platforms are working to increase the accessibility and viability of NFT games. The play-to-earn NFT games have the potential to grow beyond their current limitations and increase player income. Undoubtedly, the new ERC-4907 Rental criteria will persuade more players to play P2E games.