Potion Insurance: Architecture

Here are the main actors involved with the protocol, and the roles they play

• LPs: They supply the liquidity that the protocol uses to collateralize put contracts. They receive premiums paid by users.
• USERs: They buy potion contracts in exchange for premiums
• UMA DVM: Acts as a back-stop during price disputes, producing final pricing and settlement.
• KEEPERs: Monitor activity in the network, and dispute prices when they determine they are incorrect. They are compensated with rewards.

​Operation flow

This is the full transaction flow in the scenario where prices decrease below insurance cover (strike price):