Can I use my NFT as collateral?
In principle, any asset could be used as collateral. In practice, this depends on the contracting
parties and the respective agreement or contract. For example, if a borrower chooses to
collateralize an NFT and the lender consequently agrees to accept the NFT as collateral, the
rights and obligations for e.g. loan agreements should apply.
In property law, a title document can be used as collateral. Copyright, especially
when valued, can be used as collateral (although Banks in Nigeria are still slow in
accepting this kind of collateral).
Accordingly, these property rights contractually expressed in a token can be used
as a collateral subject to the transacting parties. Although the discretion of the
CBN and commercial Bank to accept these types of collateral cannot be forced.