InsureDAO & Hats Finance Partnership
With great excitement, we share our newest partnership with InsureDAO! InsureDAO is a decentralized insurance protocol that allows anyone to create insurance plans for their projects and investments.
This partnership aligns with our goal to become a community-owned security hub where decentralized projects can cooperate with each other in a trustless manner. By combining the power of bug bounties and insurance, we aim to create a safer decentralized future.
Hats Finance and InsureDAO Partnership
The partnership between Hats Finance and InsureDAO is mutually beneficial because Hats bug bounty data can help InsureDAO underwriters calculate risk assumptions and define premiums, while InsureDAO can help the Hats ecosystem add an extra layer of protection in case audits or bug bounties fall short.
The terms of the partnership allow projects to be insured and simultaneously open a bug bounty using their native token or the insurance underwriting LP token. Projects can earn insurance premiums while providing liquidity both in their bug bounties and insurance plans. The liquidity will be withdrawn from the bug bounty in case a claim has to be paid. This is a win-win for everyone since depositing the underwriting liquidity in a bug bounty improves the risk/return for underwriters. Additionally, bug bounties can help prevent insurance claims by paying the hacker for disclosing the vulnerability instead of exploiting it, which would cause the protocol to lose liquidity.
InsureDAO is a peer-to-pool insurance market protocol built on Ethereum. The operation and management of the protocol are controlled by a DAO, and anyone with access to Ethereum can create, purchase, and underwrite any insurance without KYC.
InsureDAO allows users to create any insurance pool like anyone can create any liquidity pool on Uniswap, since InsureDAO separates insurance pools for each protocol the risks are segregated. Therefore, any insurances, including even risky protocol insurance, will be available to buy and sell on InsureDAO.
We are excited about what this partnership represents, especially for the long-term impact it creates in the crypto ecosystem.