EDUFI NFT (ERC-721)

What is EDUFI NFT (ERC-721)?

The EDUFI NFT is a unique, non-fungible token representing an investor’s participation in the Junior Tranche. It offers access to higher potential returns in exchange for assuming a higher risk profile. Junior investors are exposed to bundle performance, and their returns fluctuate accordingly, which makes the EDUFI NFT a dynamic and high-yield investment instrument.

Key features:

• ERC-721 token containing investment metadata (principal, expected rate, payout schedule, timestamp)

• Interest payments are distributed monthly or quarterly, as configured per bundle

• Principal is locked until the loan bundle matures

• Absorbs losses first, protecting the Senior Pool in case of borrower defaults

• No secondary market currently enabled, making principal non-transferable until maturity

Variable Interest Explanation

The interest rate on the Junior Tranche is not fixed at the time of investment. Instead, it is variable and determined by the actual performance of the loan bundle after covering all senior obligations (principal + fixed interest). Because repayments from borrowers may vary due to late payments, prepayments, or partial defaults, the yield on the Junior Tranche reflects real repayment conditions.

This structure aligns risk and reward: if the loan portfolio performs well, Junior Tranche investors can receive a significantly higher yield. If repayments are delayed or fall short, the returns may be reduced—or lost entirely if defaults exceed the tranche’s buffer.

How Final Interest is Calculated

At the end of the loan bundle’s maturity period, the protocol calculates the total repayments collected and applies the waterfall distribution:

1. Repay full Senior Principal

2. Repay Senior Interest (fixed rate)

3. Repay Junior Principal

4. Distribute remaining funds as Junior Interest

The amount allocated to Junior Interest is then distributed proportionally to EDUFI NFT holders based on their original deposit size. This makes the final yield dependent on real repayment outcomes and creates an incentive for investors to select bundles with strong fundamentals and reliable lending partners.

This structure enables investors to hold individualized exposure to high-yield real-world assets, with transparency, real-time repayment tracking, and risk-aligned incentives through the platform.