Opium Protocol Advances
The project Opium Protocol has recently launched an asset insurance service when dealing in sidechains
DeFi-platform of cryptocurrency derivatives Opium Protocol has introduced a Bridge Protection solution designed to hedge risks when interacting with sidechains.
The tokenized and decentralized insurance solution is based on the Opium CDC contract [credit default swap]. Insurance can be purchased or sold as a token through the Opium Betting service.
Opium Protocol noted that the reliability of the sidechain determines the security of the bridge that connects it to the main network. The so-called bridge contract in the mainnet is responsible for storing the assets sent to the “side chain”.
Users who are confident in the reliability of a particular bridge place funds in the pool for staking in order to earn commissions. Network participants who want to hedge risks, on the contrary, pay for monthly insurance coverage.
When a user deposits assets into a pool, they assume the risks associated with the selected sidechain. You can withdraw funds once a month — on the day of rebalancing the pool or resell a position on the secondary market-at any time.
The insurance buyer will receive a payout in the event of a failure or breach of the bridge contract. A staking participant will lose their assets in such a situation.
In December 2020, the platform launched the Opium Insurance risk hedging service for the DeFi sector.
In January 2021, the platform released an OPIUM management token as part of its own drOpium liquidity mining model.
The above is a welcomed addition as a report from crypto intelligence company CipherTrace showed on Thursday – ‘’Losses from cryptocurrency theft, hacks and fraud fell sharply in the first four months of the year, but crime in the booming “decentralized finance” space hit an all-time high’’