Protocol level insurance for DeFi with no exclusions – the future of InsureTech? – SlateCast #20
fairside A DeFi insurance protocol that aims to provide the most comprehensive and fair coverage. Leverage cost-sharing networks to provide cryptocurrency users with the same benefits as traditional financial insurance.
FairSide co-founder Brandon Brown says its approach to DeFi insurance is much broader than its competitors. The company offers subscription-based indemnifications to protect users’ crypto portfolios in a number of events, including smart his contract exposures and wallet attacks.
Therefore, its coverage goes beyond DeFi and resembles traditional financial portfolio insurance.
uninsured insurance
Another exciting thing about FairSide is that they are not insured. Brown explains why:
“We have membership agreements that explain the types of losses we cover … we are really clear about what we cover, so we don’t have to leave things out.”
As such, the company does not feel the need to document policies on a per-individual basis. FairSide bases its targeting on events rather than money or numbers, Brown said. The protocol votes on incidents that may cause significant loss, and all users are covered if they decide to cover the incident.
As long as the user can provide proof of loss that shows they were part of the exploit, the loss will be automatically covered by the smart contract. FairSide continually expands its list of eligible events. Each newly added event is also added to all existing users.
shared loss
FairSide leverages a proprietary protocol called Network Staking. This refers to the ability to stake the entire network with one staking function. A user binds her coin to her FairSide capital pool and creates her FSD, which is his token native to the protocol.
The FSD token operates as a composite of capital pools, with prices changing algorithmically based on market conditions and maintaining balances. On his website at FairSide, he explains the feature and says:
“Network staking spreads risk by distributing it across the network. Since there is no correlation to a particular project, claims paid incur partial and non-permanent losses to stakeholders. will bring.”
FairSide is keen to extend the protocol beyond DeFi and crypto. Brown said the team is aware of a number of use cases the protocol could be leveraged and FairSide is looking at implementing them one by one in the future.
