Borrower Risks

The following is a non-comprehensive list of risks that a Borrower should consider before and when interacting with flowty

1. Insufficient funds to repay a loan leading to loss of collateral (NFT)

   • We encourage Borrowers to only borrow an amount that can be repaid comfortably.

   • Please have a plan to ensure that you have the necessary capital to repay your loan.

   • A cycle of taking out additional loans to pay off previous ones can spiral out of control and may not be dependable, given a peer will have to fund a new loan for you each time, which is not guaranteed.

2. Borrower forgets to repay before loan maturity

   • We require an email address to be saved to your user profile to ensure that our reminders and notifications are received by Borrowers.

   • Subject to any technical issues, we will send several notifications before a loan's maturity.

   • Please always monitor your outstanding loans and do not solely rely on Flowty's notifications.

3. Borrower loses access to an account with outstanding loans

   • During the listing process, Borrowers can opt in for Auto Repayment, which will automatically repay a loan for you if you have a sufficient balance in your wallet at loan expiration.

   • We advise all users to create an account backup plan to ensure access to their account under any scenario.

   • Blocto is a user-friendly wallet, but there are certainly situations in which individuals can lose access to their wallet.

   • Have a contingency plan with a trusted friend or family member should you lose access to your wallet

4. Technical or logistical issues that prevent timely repayment (resulting in a default and a loss of collateral)

   • During the listing process, Borrowers can opt in for Auto Repayment, which will automatically repay a loan for you if you have a sufficient balance in your wallet at loan expiration.

   • We highly recommend that Borrowers pay back loans as soon as they have the means to do so.

   • Many of the risks that we have outlined can be avoided by not waiting until the last minute to repay a loan.

   • To the extent possible, we will provide advanced notice for any events affecting the Marketplace, including but not limited to: issues with Flow blockchain, Blocto, or the Flowty platform.

5. Unanticipated need to have the NFT in your wallet during the loan term (TopShot Challenge, Airdrops, Community Events, etc)

   • We encourage careful planning to ensure the NFT will not be needed during a loan.

   • Should there be an unexpected need to regain control of your NFT, repaying the loan early is the only way to reclaim your NFT

   • Please note that repaying a loan early will not reduce the interest owed to the Lender.