🔪 Fractionalization: Lock & Mint Shares
Understand how NFTs are locked in vaults and tokenized
Split expensive NFTs into affordable pieces
Your Progress
0 / 5 completed⚙️ How Fractionalization Works
Fractionalizing an NFT is a multi-step smart contract process that converts a single ERC-721 token into many ERC-20 tokens. Each ERC-20 token represents a fractional ownership stake in the original NFT.
🎬 Interactive: Step-by-Step Simulator
Configure your fractionalization parameters and walk through the process step-by-step.
Lock NFT in Vault
Transfer the original NFT to a secure smart contract vault
vault.lockNFT(nftAddress, tokenId)
The NFT is locked in an immutable smart contract. Ownership is verifiable on-chain.
🔐 Vault Security
- •Immutable Lock: NFT cannot be removed without token holder approval
- •Audited Contracts: Use battle-tested vault implementations
- •Transparent: All actions visible on-chain
💎 Token Economics
- •Fixed Supply: Total tokens never change after minting
- •Proportional Rights: Each token = equal % of ownership
- •Fungible: All tokens identical and interchangeable
🔧 Technical Standards
💡 Key Insight
The magic of fractionalization is that you're not modifying the original NFT—you're locking it in a vault and creating new tokens that represent claims on it. Think of it like a company going public: the business (NFT) stays intact, but ownership is divided into shares (ERC-20 tokens) that can be traded freely. The vault ensures the NFT can only be unlocked if holders collectively agree, protecting everyone's investment.