> For the complete documentation index, see [llms.txt](https://docs.capsulelabs.xyz/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.capsulelabs.xyz/capsulenft/use-cases/for-defi.md). # For DeFi ### Interest-Generating NFTs There many different ERC-20 tokens, such as pool tokens, that generate revenue by holding the token. By wrapping these tokens within Capsules NFT, users of the Capsule Protocol can create an NFT that passively generates interest. The holder would be able to redeem their Capsule NFT at any time in order to obtain their underlying tokens. Please note that all interest generating activity is initiated by the minter. No interest generating activity is completed, performed or added by the Capsule Protocol. The interest generating tokens are merely stored within the Capsule NFT. ### Asset Portfolio NFTs By placing multiple tokens in a Capsule NFT, funds would be able to group user investments in a single NFT. This single NFT could then be transferred or traded within a single transaction, saving users money on gas and providing a more seamless experience. Portfolio NFTs can further be fractionalized for greater liquidity/accessibility to the portfolio, essentially creating "shares" for the original fractionalized Capsule NFT - this could be analogously compared to an exchange traded funds in the traditional finance space.. ### Initial NFT Offering (INO) The Capsule Protocol allows new or existing projects to distribute their project tokens through NFTs. This would allow projects to complement or completely replace the traditional method of initial coin offerings (ICOs) with initial NFT offerings, or INOs. This is an entirely new way of distributing project tokens. ### Cross-chain Asset Bridge Capsule NFTs provide a revolutionary possibility to allow ERC-20s and ERC-1155 tokens to be permissionlessly bridged to any chain that supports an ERC-721 token bridge. By storing tokens within a Capsule NFT, you are essentially making those digital assets "compatible" to be transferred across ERC-721 bridges to other chains. Capsule NFTs that have been bridged to other chains would then simulate synthetic assets of their underlying tokens on the new chain/ Taking the above example a step further: the newly bridged Capsule NFT could be fractionalized for greater liquidity/accessibility to the synthetic asset. {% hint style="success" %} These ideas were developed by the team, but we encourage the community to get creative and explore new possibilities! {% endhint %} --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.capsulelabs.xyz/capsulenft/use-cases/for-defi.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.