Main Channel t.me/blockchain_lobsters
Will be interesting to see if Frax tries to freeze these funds (if even possible). 10m$ would be where you start to consider acting right vs ethos
Читать полностью…Yeah, I don't think should grade Nexus as a failure just because they didn't solve the whole problem. I think it is going to take 100 Nexus-types to actually insure the web3 space. And that is how it should be
Читать полностью…Nexus failed. That was the biggest attempt. Ultimately, the insurance has to be huge enough to handle numerous (correlated) policies
Читать полностью…If there is a web3 model for insurance that can cover our own, I think that will eventually become a massive pillar of the industry
Читать полностью…That's why all the projects mentioned above can scale to only $5b at best, and in the $10s of millions at the realistic end
Читать полностью…ugh, can we do it without Lloyd's, though? Let's make a a Lloydefi against the suit-and-tie people
Читать полностью…I truly think it’s an education issue and I’m proposing with a few people that maybe we do a defi day in lloyds soon. Get some quants in and some actuaries in and do some work
Читать полностью…The craziest property of protocol insurance is you can’t just hack morpho and suddenly be like “crime seasons boyzzz” and then hit euler aave and kamino
It’s almost perfectly orthogonal and has really nice diversification
ALL HACKS EVER in a single year and you still make money with a 4% premium. That’s including all the proper bottom feeder protocols not even just top tier
Читать полностью…But you are saying that GMX could buy the 5% chance of getting hacked to offset the potential lose? In theory, I guess that could work, but there aren't liquid markets for that on any prediction market, especially not for the thousands of various DeFi projects that are out there holding $1m+
Читать полностью…If I put $1M of ETH into aave and borrow 400k USDC to go do stables stuff I'm paying 5% to stretch goal get 8% + eth yield 2%.
The prediction market for aave hack in 1 year would be like $0.95 no; so I buy yes at $0.05 and now my yield is treasury rates 😂
https://x.com/PeckShieldAlert/status/1943162287595905409
Читать полностью…I disagree - they have a fantastic product for small coverage which fits specific needs. We need people like nexus to help build coverage towers
Читать полностью…But institutions are using L2s and DeFi products to an extent, and providing better security is priority #1, but supplementing that with native insurance coverage is what could give L2s like Base, Arbitrum, Avalance, etc. the safety net necessary to really start allocating
Читать полностью…but then that’s saying fuck real money and stay isolated and small 🙁 The big boys we’re after reeling into our amazing tech want lloyds not daos
Читать полностью…The issue for Lloyds is that in DeFi we haven’t shown that we actually have demand for this product. The demand needs to be in the hundreds of millions to actually make reinsurers give a shit. These guys underwrite big digits so doing 50m here and there on customised policies is literally a waste of their time if they can’t scale it
I think secondly they have compliance issues frankly as well paying out to randos
Yeah, exactly. Degens aren't interested in an easy 4% lol
Читать полностью…My main concern isn’t the premium tbh - I’m fairly confident we can get good premiums as they underwriters aren’t stupid. My concern is that we can’t get enough underwriters to give a shit to cover the demand
Читать полностью…Yes, this is exactly what I was getting at! Again, I have no project to shill here, I don't think anyone is doing it at scale. But the economics make sense, and to disrupt the insurance (and really don't sleep on the reinsurance) industry is the most Satoshi thing we have left to do as an industry
Читать полностью…no that’s like an absurd extrapolation 4% is all hacks ever in a single year. I’m putting a statistical limit on what anyone could ever pay
If someone pays >4% they just don’t wanna insure you is the TLDR
So you’d ask users to pay a 4% fee on each deposit or withdraw?
Читать полностью…If people price the risk the stats don’t agree tbh. Out of the major defi protocols the biggest hacks have been largely bridges and even then it’s like 600m
https://www.theblock.co/data/decentralized-finance/exploits
Bizarrely they include bybit as a “defi” hack which makes no sense IMO
If you insured all the TVL in DeFi and paid out every single hack of all time (5.4bn) in a single year you would still break even on an insurance premium of 4%
Insurance is the most well understood market design in essentially all economics.
You can have direct peer to peer market. A pooled model. A government model.
Pooled models have always inevitably ended up government models with maybe the exception of car insurance but even then disasters tend to get subsidized heavily by gov when there's an act of god. Peer to peer never scales.
Hacks are essentially the defi equivalent of acts of God.
In realistic terms, prediction markets are the closest bet.
"Will GMX (any version or v1 or V2 w/e) get exploited (and admit it was an exploit) for >$10M before Jan 1 2026 UTC".
But you don't see those markets do much b/c baseline assumption is no and spreads are wide relative to yield and protocol revenue