Kyber Network Adds $ 20 Million Insurance Against Unslashed Finance »CryptoNinjas

Kyber Network, an on-chain cryptocurrency liquidity protocol, has announced that it is now offering the first native insured pools for its new Dynamic Market Maker (DMM) protocol. The policy adopted by Kyber covers up to $ 20 million (10,000 ETH) and focuses on smart contract risk.

Dynamic Market Maker (DMM) is a next-generation AMM and key protocol that will be added to Kyber 3.0’s liquidity hub and will bring significant benefits to DeFi liquidity providers, including fee optimized, extremely high capital efficiency, and completely unlicensed liquidity contribution from all and access to liquidity by every DApp, aggregator and end user.

The Kyber DMM codebase has been reviewed and audited multiple times by both the team and third-party auditors, and remains open source on Github for community developers to review. But as added protection and a mark of commitment to security, Kyber has now also purchased coverage from Unslashed for its users.

“Kyber has made the decision to purchase bulk insurance for the DMM, which covers all liquidity providers and market makers. With this Kyber shows how important it is to combine the transparency of self-custody and smart contract audits with insurance as an extra layer to reduce the risk for users. “
– The Kyber Network team

Active since 2017, Kyber was one of the first DeFi protocols aimed at providing seamless on-chain liquidity through an open reserve architecture. Kyber has always maintained a high standard of smart contract security and its liquidity infrastructure has enabled nearly $ 5 billion in trading volume for thousands of users, while managing more than 50 reserves and integrated into more than 100 decentralized applications.

Insurance benefit for smart contracts

Smart contracts can be subject to different types of attacks, many of which exploit vulnerabilities in the smart contract’s code.

The losses due to technical issues with smart contracts, which could be either code vulnerabilities, errors or omissions in code implementation, or unavailability or inability to access or process deposited funds, are one of the main risks in DeFi, which sometimes results in losses for users.

If an event were to occur currently involving one or more smart contracts, LPs and market makers could be affected and they could suffer losses.

The status quo within the DeFi insurance industry was to allow users to purchase and manage their own coverage. Historically, protocols have placed a burden on their users to insure themselves. When this happens, it is the user who pays the bill, not the protocol.

Bulk insurance offers Kyber significant benefits in several ways:

  • It provides a smoother experience for users and promotes inclusivity.
  • It builds trust between Kyber and its users and shows how important it really is to protect its users.
  • It sets the precedent that insurance is a must have.

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