Covered DeFi Protocols
Usd8, together with our security partners, independently vets and selects DeFi protocols that demonstrate the strongest security practices. Coverage is offered on a per-LP-token basis, depending on our security assessment, and is limited to a percentage of potential losses, capped by the Cover Pool balance.
Once coverage is offered, the Cover Pool will accept the specified LP token for claims at any time, permissionlessly. Claimants receive a proportional mix of assets matching the Cover Pool’s composition.
Claiming
- To initiate a claim, the user provides the protected LP token and temporarily locks some Usd8. The more Usd8 locked, the greater the weight of the claim. (locking Usd8 optional if LP token is already a Usd8 LST).
- The claim then enters a 10-day waiting period, during which other users may also join. After this time, this LP token will be removed from covered list, further claims will not be accepted.
- Users can finalize their reimbursement after the 10 days waiting period, reimbursement amount depends on the total claims, total locked Usd8 and Cover Pool balance at the time. The payout will be in the exact asset types and composition of the Cover Pool.
- 60 days after claiming, the locked Usd8 will be unlocked and can be withdrawn from the Cover Pool.
If the Cover Pool cannot fully cover all claims, assets are distributed based on the amount of Usd8 each user locked and the value of their LP tokens.
After a claim, the protected LP tokens forfeited by claimers becomes the property of the Cover Pool LPs, which can be claimed when LP withdraws from the cover pool.
Claim Cooldown
Newly received Usd8 are subject to a 30-day cooldown for claiming lock, except from recognized Defi contract addresses (e.g. Usd8 LSTs and LP positions). This prevents users from purchasing Usd8 on the spot when claiming while still allow holders to yield with Usd8 while enjoying the protection.