Overview
This section provides an overview of the protocol.
Roles
- Token holders vote for risk policies, curators, and guardians
- Risk curators set up pools. They can underwrite pools ("self stake") and set commissions on yield (risk metrics). They can also restrict pool access via gate contracts
- Underwriters vote for up to 5 pools they want to underwrite with yield-bearing tokens plus backup direct investment
- Users receive yield-bearing
iXtokens with fast exit capability into any asset of the pool - Underwriters receive yield-bearing uX tokens with 28-day unlock period and liquidity-dependent exit
- Guardians are AI systems that monitor positions and close them if policies are violated or insurance pools become undercapitalized
Insurance Process
1
Deposit
- Underwriters deposit yield-bearing stablecoin
Xto insure a pool and receive underwriter receipt tokenuX - Users deposit yield-bearing stablecoin
Y. This is only possible if there is sufficientXin the pool. The deposit ofYinitiates the lock forX; as long as there is noY, underwriters can immediately withdraw their deposits
2
Being Insured
- Over time,
XandYincrease in value due to underlying yield.Xreceives a small amount ofYtokens (Cy) that can only be claimed byXholders
3
Withdraw
1
All Good
- Users deposit their
iYtokens and receive payment inY - Underwriters deposit their uX tokens and receive payment in X after 28 days
2
Problem with Y
- Users deposit their
iYtokens and receive payment inX - Underwriters deposit their
uXtokens and request payment inX, but must wait 28 days. However, there may be nothing left once the request is executed. Underwriters can only request payment inYifXis already depleted. Next, underwriters would request what remains in the pool, andYmight still retain some value
3
Problem with X
- Users deposit their
iYtokens and receive payment inY - Underwriters deposit their
uXtokens and request payment inX, but must wait 28 days. However, there may be nothing left once the request is executed