Decentralized underwriting: Difference between revisions
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== Insurance DAO protocols == | == Insurance DAO protocols == | ||
=== Components === | |||
# DAO = {Underwriters} | |||
# Underwriter ∋ REP tokens a) Propose contracts with REP b) Police contracts with REP | |||
# Insurance contract ([[Work smart contract]]) | |||
# [[Validation Pool]] | |||
=== Token scheme === | === Token scheme === | ||
==== Workflow ==== | |||
(See Figure 1.) | |||
# Underwriter <math>U_1</math> sells a contract to a customer. | |||
# <math>U_1</math> encumbers the canonical amount of REP in the contract. | |||
# Contract Validated by DAO. | |||
# Customer a) pays premia, or b) defaults, or c) claims | |||
# DAO a) mints REP for <math>U_1</math> proportional to premia & distributes REP salary, or b) cancels contract, or c) pays claim by selling encumbered REP at market | |||
[[File:IDAO workflow.jpg|border|593x593px]] | |||
== Consequences == | == Consequences == | ||
Revision as of 21:50, 14 May 2023
??Insurance DAOs (iDAOs) for creating decentralized underwriting markets, based on this paper.[1]
Insurance DAO protocols
Components
- DAO = {Underwriters}
- Underwriter ∋ REP tokens a) Propose contracts with REP b) Police contracts with REP
- Insurance contract (Work smart contract)
- Validation Pool
Token scheme
Workflow
(See Figure 1.)
- Underwriter sells a contract to a customer.
- encumbers the canonical amount of REP in the contract.
- Contract Validated by DAO.
- Customer a) pays premia, or b) defaults, or c) claims
- DAO a) mints REP for proportional to premia & distributes REP salary, or b) cancels contract, or c) pays claim by selling encumbered REP at market
Consequences
Properties engendered
- More auditable/transparent
- More stable, trustworthy
- More meritocratic (rewards and punishment are isolated to the agent)
- Democratized access to participation at all levels
Tokenomics
Capital reserves can be eliminated
economic justification
Where we stand practically in deFi
Missing:
- (d) oracles
- *adjudication
- (d/e) stable coin
- (e) smart contracts
- regulatory clarity
Code
See Also
Notes & References
- ↑ Craig Calcaterra, Wulf A. Kaal, & Vadhindran K. Rao, (2019) "Decentralized Underwriting". Available at https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3396542 (Retrieved 2023 March 16)