Audience: Funds or individuals looking for high yield products and confident with low default (hack) risk for the protocols they are providing reserves for. Stake stable coin (USDC) as insurance reserve capital with the intention to generate premiums on their capital in exchange for providing coverage for specified insured event(s), if there is no, or a low rate of, protocol failure.
Benefit: Tidal will be offering structured, pre-determined mutual cover pools for the cover providers earning high yield. Cover providers can customize their selections of the protocols they feel confident and provide cover for, earning 90% of the premium from cover buyers, + TIDAL token incentives (refer to cover mining program). The reward is distributed on a weekly basis.
Risk: Stable coin reserve pool will be used to compensate for a valid claim. Cover providers’ capital will be reduced proportionately by the percentage of their position in the pool. The total payout amount in the event of a smart contract hack is up to the lower of the (a) amount of loss due to the hack and (b) the cover purchased.
Recovery: We truly believe that cover providers are taking a high risk in the early stage of DeFi development, mainly due to lack of historical data and unknown risks in various hack events. Therefore, in addition to earning high yield from cover premium and TIDAL token incentives, couple recovery mechanisms are also designed to accommodate cover providers. 1. Recovery from Guarantor Reserve. 2. Recovery from TIDAL staking pool. Withdrawal: withdrawal request will become pending next week, if no staked protocols have any valid claims during the time frame, withdrawal amount will be returned to cover providers wallet.
Withdrawal: withdrawal request will become pending next week, if no selected protocols has any valid claims during the time frame, withdrawal amount will be returned to reserve provider's wallet.