Cover types

There are various types of available covers

Each decentralized project is subject to a different type of risk which needs to be covered. The table shows an overview of what risks can be covered by different types of products. If you want to learn more, explore this Medium article: https://brightunion.medium.com/exploring-the-defi-coverages-aefe8803155d

Cover types	What risk is covered?	Example projects
Protocol hack and failure	In case the user has financial loss due to failure of the protocol caused by code, governance and oracle failures	Compound, Uniswap
Yield de-pegging	In case the market price of a yield tokens deviates from the face value for a significant amount of time	Curve, Yearn
Stablecoin de-pegging	In case the market price of a stable coin deviates from the underlying currency for a significant amount of time	DAI, USDT
Custodian Cover	Protects against hacks and halted withdrawals at crypto wallets	Binance, Kraken

Why Are Various Types of DeFi Coverage Needed?

At Bright Union, we recognize the diverse challenges within DeFi, necessitating distinct coverage solutions. Here’s how we address these unique risks:

• DeFi Protocol Challenges: Engaging with DeFi protocols means you manage your own digital assets. The primary concerns are technical, such as code errors or system failures. Our coverage is tailored to mitigate these technological risks.

• Peg Stability Concerns: For assets linked to another value, the risk lies in losing this connection, as seen when UST detached from the US dollar. This can result in losses without any protocol issues. Our coverage ensures protection against such peg disruptions.

• Custodial Storage Issues: When assets are stored by custodians, risks include poor management, cyber threats, or restricted access. Our custodial coverage safeguards against these vulnerabilities.

How to Safeguard Against Multiple Risks?

To achieve comprehensive protection, multiple coverage types or bundled solutions may be necessary. At Bright Union, we provide customized options:

• Protocol Coverage: Protects against losses due to technical failures or security breaches.

• Peg Stability Coverage: Secures against losses from deviations in asset value connections.

• Custodial Coverage: Defends against mismanagement and unauthorized access.

Discover our coverage plans to fully protect your assets in the dynamic DeFi environment.