Basket Collateral

Paddle Protocol goes beyond handling individual assets by incorporating the "Basket Collateral" concept, a strategy borrowed from traditional finance’s security lending and borrowing practices. This approach allows asset holders to consolidate multiple assets into a single financial contract, enhancing the overall utility of their portfolio.

Benefits of Basket Collateral:

1. Efficiency in Transactions: By grouping assets, such as multiple high-value NFTs, into one contract, asset holders can significantly reduce transaction costs. For example, instead of incurring tenfold gas fees for ten separate BTC NFTs, they can financialize all at once, saving on expenses and streamlining the process.

2. Optimal Use of Low-Value Bespoke Assets: Basket Collateral also proves ideal for enhancing the utility of lower-value bespoke assets. These can be bundled with main assets, allowing them to serve as complementary additions within a larger financial package.

This functionality not only makes high-value collateral loans or over-the-counter (OTC) trades more efficient but also optimizes the use of bespoke assets, providing a comprehensive solution that adapts to the diverse needs of asset holders.