📄Smart Contract
The DEIN DAO (DEIN token stakers) vote on whether claims are valid. As such, all payouts are discretionary as per the will of the DAO members. DAO members are financially incentivized to make decisions in accordance with the terms defined below; to learn more on how voting works, read the Claim Voting Process page.
All votes are encrypted when cast, and decrypted after the voting period is over. Because voters cannot see how other members are voting, they cannot confidently game the system. Voters in the minority are not rewarded, and if they are in the extreme minority (a 90% / 10% vote split or more) their staked tokens are slashed.
Definitions:
Coverable Event - an event that meets all of the criteria defined in the section “What Is Covered?” below.
Cover Period - The duration of a policy, starting at the moment it is purchased.
Covered Amount - means the amount of cover specified by the Policy Holder at the time of coverage purchase.
Permanent Loss - Any loss of assets that is, or will likely be, permanent. The mere promise of repayment from the exploiter or the protocol, depending on the circumstances, does not preclude the loss from being permanent. There are often announcements from the team with an intent to repay, or negotiations with the exploiter, or an ongoing attempt to subdue the exploiter and reclaim the funds--the DAO must determine the likelihood of repayment in all these events.
Policy Holder - The owner of the address that purchased the policy.
Protocol - A system comprised entirely or partially of code that performs a function or series of functions.
DAO - A decentralized autonomous organization. In DEIN's DAO, token holders can stake their DEIN tokens in the protocol to receive vDEIN, which is used as a measurement of voting power within the DAO.
What Is Covered?
Members of the DEIN DAO (token stakers) agree to approve claims if ALL of the following conditions are met:
During the Cover Period, the Policy Holder suffers a Permanent Loss; and
The Permanent Loss was caused by the failure of the Protocol due to an unauthorized, unintended, or malicious use of the code or its functions; or
The Permanent Loss was caused by the Protocol's front-end interface due to an external attack; and
The value of the Permanent Loss, at the time it occurred, can be readily calculated; and
The on-chain address that purchased the policy is the same address that suffered the loss, or is clearly owned by the same Policy Holder that purchased the policy. [The intent of this clause is to ensure that Policy Holders are not selling or splitting the payouts of their policies to third parties.]
What Is Not Covered?
Members of the DEIN DAO (token stakers) agree to deny claims if any of the following are true:
The Permanent Loss suffered by the Policy Holder was not caused by any fault in the Protocol's code or front end.
The insured protocol uses a bridge developed by a third party in order to extend its token to other networks. This bridge is exploited, giving the exploiter a large number of the Protocol's tokens and crashing the token price.
The Protocol, its community, or popular news or social media sites made significant efforts to warn the public that there was a vulnerability in the Protocol's code or the Protocol's front end at least 24 hours before the Permanent Loss occurred, and the Policy Holder could have, but failed to, prevent the loss.
The Permanent Loss suffered by the Policy Holder was the fault, in whole or in part, of the Policy Holder; including phishing, personal security breaches, malware, key loggers, falling victim to a scam (regardless of the circumstances), or any other activity where the loss had nothing to do with the Protocol's code or front end.
The DAO has good reason to believe that the Policy Holder is responsible, or partially responsible, for the coverable event that caused the loss. (I.e., the Policy Holder is the exploiter.)
The Policy Holder has been reimbursed for their Permanent Loss, or will likely get reimbursed by another party, including: another insurance protocol, the Protocol itself, the exploiter, a charity, or any other party intending to repay the Policy Holder for the loss they suffered.
The Coverable Event took place outside of the Cover Period
The Protocol works as intended and is not exploited, but a Permanent Loss is suffered by the Policy Holder due to interference by, or misinformation from, a third-party source, such as an oracle, a DAO, a miner, another network, etc.
The loss is caused by a drop in value of the Protocol's native tokens being held directly by the Policy Holder in their own custody, regardless of whether the drop in value was caused directly or indirectly by the Coverable Event.
The claim is otherwise valid, but it is likely that the Protocol itself was deployed for the purpose of claiming coverage from DEIN.
The claim is otherwise valid, but the Protocol was forked from another protocol with known vulnerabilities.
The claim is otherwise valid, but the Protocol suffered an exploit that was disclosed in a publicly available audit report from a recognized auditing authority.
The Permanent Loss suffered was as a direct or indirect result of the depegging of a stable asset deployed directly by the Protocol.
The Permanent Loss was caused by movements in the price of any assets relied on by the Protocol. (Economic flaws in Protocol design are not covered).
The Permanent Loss was caused by a failure of the Protocol's front end due to negligence or a failure on the team's behalf, and not caused by an attack on the front end.
What are the standards for evidence?
The burden of proof lies on the Policy Holder. Policy Holders should keep this in mind when organizing their claims and should try to be as thorough and detailed as possible in their submission of evidence.
We suggest submitting:
A thorough description of the events leading up to the coverable event, in chronological order, with as many links to on-chain data as possible.
Information and posts directly from the Protocol’s team members via official social media accounts or channels of communication (such as Twitter, Discord, Telegram, LinkedIn, and others.)
News stories and articles from credible news sources.
Transaction IDs, wallet addresses, and other on-chain data.
Screenshots of information or data that pertain to the claim (Keep in mind that images can be easily photoshopped and are not the most convincing evidence.)
Cryptographically signed evidence that ties the loss to the claimant.
How do you prove a loss as a Policy Holder?
Policyholders that wish to make a claim should submit any or all of the following in an attempt to prove they have suffered a permanent loss:
I. Transaction IDs proving that the Policy Holder’s wallet deposited assets into the protocol, and transaction IDs that pertain to the Coverable Event.
II. Any post or article from the Protocol’s team, a reputable news source, or an auditing firm confirming that there was an exploit, and providing additional information.
III. A description of the Coverable Event in the Policy Holder’s own words.
IV. Supporting materials that may help to determine the value of the lost assets at the time of the Coverable Event.
V. If the address affected was not the same address that purchased coverage, any evidence that proves the Policy Holder is the bonafide owner of the address that suffered a Permanent Loss.
How much is paid out?
A successful claim can only receive up to the policy’s maximum coverable amount.
Successful claims may receive less than the maximum coverable amount in the event that the DAO determines that the loss suffered by the Policy Holder was less than the maximum coverable amount.
The DAO is incentivized to pay the claimant the exact amount that was actually lost in the coverable event.
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