DeFi Insurance Protocol Cover Follows The $19 Million Dai Hack Of Pickle Finance
DeFi Insurance Protocol Cover Follows The $19 Million Dai Hack Of Pickle Finance
November 24, 2020
DeFi Insurance Protocol Cover Follows The $19 Million Dai Hack Of Pickle Finance
DeFi Insurance Protocol Cover Follows The $19 Million Dai Hack Of Pickle Finance
November 24, 2020

DeFi insurance protocol Cover is following the $19 million Dai hack of Pickle Finance and the majority of users want to see a payout happen.

It has been reported according to the claim on Cover’s website filed November 21 that there have been 99 votes at the time of publication throwing around 9,800 COVER tokens — more than 99% of respondent tokens — behind a “yes” vote to pay out affected coverage holders.

Ivan Martinez, a technical advisor for Cover, said on Twitter that the vote pass, the claim will move to its Claim Validity Committee “to decide if it’s valid for a payout or not.” 

As the hacker absconded with around $19 million in Pickle user funds, Cover clarified that any payout was not going to cover the entirety of the loss.

ALSO READ :  Hash Power Of Bitcoin Network Jumps By 30% Over The Past 24 Hours

Semi-anonymous and core Cover developer Alan said:

“After CVC approval, all PICKLE CLAIM token holders will be able to redeem 1 CLAIM token for 1 DAI.”

However, there are over 340,000 Pickle CLAIM tokens outstanding, where they trade on secondary markets for $0.90, as he pointed out that this could lead to some “arbitrage opportunities” for traders who expect the proposal to pass. 

The report said that Pickle’s claim is one of the first test cases for a decentralized insurance protocol using a blockchain snapshot to vote on coverage. As many in the crypto space have been affected by hackers taking advantage of exploits since the DeFi boom began, the response on social media has been supportive of a payout, but also skeptical.

The hackers were able to swap funds between a malicious copycat contract and Pickle’s yield-bearing vault called the “cDAI jar” leading to users noticing the jar had been emptied.

ALSO READ :  Gemini Launches An Insurance Company To Cover Up To $200 Million For Its Custody

It has been analyzed that under Cover’s guidelines, the project states that it will pay out claims from exploits or certain attacks on smart contracts, specifically referencing flash loan attacks by resulting in “a material loss of funds from the smart contract, or smart contract system with funds either moved to another address which the original owner or owners do not control or the funds are made permanently irrecoverable.”

Likewise, in addition to Pickle Finance, hackers have targeted several DeFi protocols this year resulting in the loss of millions in funds, from Harvest Finance, Value, Akropolis, Cheese Bank, and Origin, to name a few.

A robust selection of insurance protocols such as Cover may help mitigate the fallout from such attacks.

 

Thus, Alan concluded:

“I think DeFi coverage is essential for mass adoption of these protocols. Some of these protocols that people are creating will change the financial industry for good, but since we are especially early, there are many attack vectors present, and many more unknown. Our job is to allow users to experiment with game-changing protocols while also remaining hedged against exploit risk.”

Source: Cointelegraph


Disclaimer

Crypto News Point a news platform of Digital Notice Media Labs is primarily a regular publication of information, commentary and articles focused extensively on fintech, blockchain technology, cryptocurrency, blockchain-based tokens, cryptocurrency market trends, and trading strategies. We do not provide individually tailored investment advice and does not take a subscriber’s or anyone’s circumstances into consideration when discussing investments, nor is Crypto News Point registered as an investment adviser or broker-dealer in any jurisdiction. Information contained herein is not an offer or solicitation to buy, hold, or sell any digital assets.

Affiliate Disclosure: To help support the work we do here at CNP, we often link to products and deals from around the web. Should you buy some of these, we may get a portion of the sale.

We in generally gather content from the major websites. In every article there is always a clear link and attribution to the source publication. If you have any issue with any of our published content taken from your site, kindly let us know so that we can take appropriate action. In any case, the content of the pages of this website is for your general information and use only. It is subject to change without notice.

You May Also like

Ishita Bora

Ishita Bora is a Senior Content Creator at Digital Notice Media Labs with an experience of 1 year. She has completed her Master's Degree in Language and Linguistics in 2019 from Gauhati University, India. Her interest lies in blockchain technology and cryptocurrency space, as she loves writing about blockchain and other blockchain-related articles. Currently, she is working on blockchain-based news, reviews, featured articles, and guides.