Defrosters can get insured. Against what?
As our exciting partnership with Degis takes off, allowing users to deploy their MELT to purchase insurance against unexpected events, we would like to invite our community to dig a little deeper into this offer.
All details below.
Major Risk:
- Funds stored in liquidity pools were hacked
- Oracle Failure
The protection buyer may get compensated under this Protocol Cover if:
- During the protection period, Defrost Finance directly causes the loss of user funds due to the failure of one or more of the following components:
1.1. Code be used in unexpected ways; or
1.2. Smart contract design loopholes that result in the accidental confiscation or seizure of funds deposited into the protocol, solely for collateral, liquidity provision or staking purposes; or
1.3. Oracle failure that causes the oracle price is either:
1.3.1. Be maliciously manipulated to cause the price of the token to far exceed the observed market price; or
1.3.2. Materially different from the expected data source;
Which causes an unexpected liquidation of collateral or an unexpected withdrawal of funds from the designated protocol; or
- Defrost Finance loses user funds:
2.1. transferred to other addresses beyond its control; or
2.2. Cause the funds to be permanently irrecoverable;
Exclusions
Degis Smart Contract Protection will not pay compensation in any of the following situations:
- Any incident or loss due to phishing, private key security breach, loss of private key, malware, exchange hacks, or any other activity where the protocols continue to operate as intended.
- Any events or losses where the designated protocol was deployed for the purpose of claiming compensation from Degis Smart Contract Protection and not for real usage by customers.
- Any smart contract security event that occurred outside the protection period.
- Any event or loss that occurs during the period of protection if a public bug disclosure or warnings concerns related to the incident before the protection period begins； or
- Any events or losses where Defrost continues to operate as intended.
- Any event or loss caused by changes in market prices of assets.
- Any events or losses resulting from the owners or controllers confiscating or stealing funds from users in line with the permissions of the designated protocol irrespective of the individual or entity that has access to the private keys of the owner or controller accounts (“rug pull” exclusion).
10. Protection ends when:
10.1 The Protection Period specified at purchase has ended.
10.2 After a smart contract security event occurs in the underwriting protocol and triggers a payout
Premium:
The premium will be 3.2% for the first 7 days, then it will turn dynamic according to the following formula:
d% = Cn * 1/NLPn% + 1/N * a%
Where:
Cn% = Cn + Xi-1N Ci+X
LPn% = LPni-1N LPi
a% means the base premium set by community voting
Cn means that the current coverage value of Project n
X means the cover amount the user is purchasing
LPn means that the protection pool LP tokens stake in the priority pool of Project n
N is the total amount of projects protected in Degis protocol protection
Thus, the premium one has to pay for protocol A after 7 days is:
Premium = D365*X *d%
Maximum Coverage Ratio:
30%
Purchase Token:
$MELT
