# Peak Andromeda Wrapping

NFT Staking is by no means a new phenomenon.

However, a persistent issue has been overlooked for too long in NFT staking; the NFT itself only holds speculative value. Beauty is in the eye of the beholder.&#x20;

Peak Andromeda is a Wrapped NFT public utility ecosystem for the Metis Andromeda mainnet.&#x20;

Major projects in the ecosystem, such as Netswap, Tethys, Hermes, Aera, Maia, etc., have their own incentive structures to reward users. However, they often find themselves rewarding stakers in their native token in exchange for them staking non-native assets. Further, the ones that offer NFT staking are subject to the problem of NFTs that are accepted for staking having no underlying collateral value.&#x20;

As a public utility, Peak Wrapping solves several problems in the Metis Andromeda DeFi ecosystem.

1. Projects can opt to employ an NFT staking contract to boost yields that reward users that support their ecosystems. By incentivizing DeFi stakers to pursue additional yields by supplying their liquidity in a wrapped NFT, they can enforce a price floor for a period defined by the user’s time-locking preferences.
2. Suppose the user wishes to opt out of an NFT staking arrangement. In that case, they can sell their wNFT on the secondary market without impacting the market value of the underlying assets and, based on scarcity at any given time, can realize a profit.
3. Their NFT staking contracts are programmed to accept the desired NFT collection, either their own NFT collection or a third party. They can improve retention by nominating a designated NFT token contract address and encouraging users to mint their NFTs for non-speculative usage.
4. Andromeda projects utilize similar mechanics to the wrapped Peaking Duck NFTs that grow the wNFT holders' underlying share of collateral based on secondary market activity and the application of secondary market royalties that compound back into the collateral.&#x20;

On the secondary market, wNFTs of Andromeda projects accrue collateral from royalties that are as follows:

10% wNFT Royalties:

* 5% to The Summit Liquidity Mine Contract
* 5% to the wNFT Collateral Contract

The former we will explore the benefits for the Peak and wider Andromeda ecosystem in the following section. Per the latter, there are benefits for Andromeda projects to utilize this design as there are clear incentives for their community to seek additional yields while supporting the project through guaranteeing liquidity provision for the duration of the time-lock, at minimum. Multiplier traits, like Peaking Ducks, will be applied to the wNFT.&#x20;

When the wNFT owner decides to unwrap, a 5% fee is applied to their share of collateral locked in the collateral contract. Distribution is as follows:

* 2% compounds back into the Collateral Contract that is rewarded to future unwrap events.
* 2.5% is deposited into The Summit liquidity mining contract.
* 0.5% to Peak Finance DAO.

NFT Staking contracts are programmed to recognize the presence of a qualifying trait to apply a boost to their emissions. There are also real reasons a user may trade on the secondary market.&#x20;

Example: A user supplies $10,000 USD of $TETHYS-$METIS LP tokens that are locked in the contract for 12 months. At the end of the time lock, the multiplier traits are still valid as a multiplier for a Tethys liquidity mine. Instead of unwrapping the NFT to redeem the underlying collateral, the owner may sell it on the secondary market at a premium.&#x20;

A buyer may recognize the appeal of procuring a wNFT with the maximum yield-generating effect attributed to time-locking for 12 months. However, given that time has expired, they can redeem the underlying collateral at any time.&#x20;

Furthermore, with wNFT trade volume, the underlying collateral will likely offer a greater pro-rata LP token redemption and thus remain profitable to unwrap. LP tokens are particularly lucrative as there are often an additional layer of yield within the accumulation of exchange fees over time.

The next section will explore the benefits to the entire Andromeda ecosystem of the multi-reward offering in The Summit.

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