Yearn Finance Offering Tokenized Nexus Mutual Insurance Covers for 5 Top DeFi Protocols
YearnFinance is all set to provide insurance for the popular DeFi projects that involve Balancer, Compound, Curve, Synthetix, and Yean Finance itself.
“Impossible to be bullish DeFi and not see insurance as a critical pillar,” noted Jason Choi of crypto fund The Spartan Group.
These tokenized insurance covers will be underwritten by Nexus Mutual with no know-your-customer (KYC) and anti-money laundering (AML).
Tokenizing the insurance policy also means there are many possibilities here, such as they can be transferred, bought, sold, or even collateralized.
Possible @NexusMutual playbook to billions in market cap:
1) Stringent risk policy with proven track record
2) Capital pool scaling via insurance mining
3) Aggressive distribution via tokenized covers https://t.co/hjvORrZ9Do
— Jason Choi (@mrjasonchoi) August 30, 2020
As Nexus Mutual founder Hugh Karp shared in an interview with Nick Tomaino, they see a lot of demand, “especially from prosumer type people (either hedge funds or bigger players in the space that want cover on smart contracts).”
For the past six months, they have been working on scaling up the capital that hasn’t been enough to meet all of their demand, and now have up to $60 million of critical mass of capital.
Interestingly, Yearn is the only contract that is maxed out, which could be because “gut feel is that it’s perceived to be higher risk … (as) Andre tests in prod.”
Nexus Mutual is currently looking at building new products like stacked risk cover to cover all the risks involved in interacting with DeFi along with oracle failures and such.
Yinsure.finance, however, isn’t ready for use yet, and as updated by Yearn Finance, it will be opened to a limited user base first.
Yearn Finance is growing at a fast pace, bringing new features for the market. Just last week, the popular DeFi protocol announced a crowdfunding on DeFi.
“The emergence of decentralized funding comes at a time when credit is drying up, as lenders tightened their coffers despite all the excess liquidity,” noted trader and economist Alex Kruger.
Amidst this, YFI is enjoying the growth Yearn Finance is seeing, approaching $1 billion in TVL.
— Alex (@classicmacro) August 29, 2020
According to BitMEX co-founder and CEO Arthur Hayes, who has also been yield farming, YFI will be hitting $100,000.