Is there documentation covering how protocols can apply to be covered on Nexus?
Is there an active sales function at Nexus?
There are some interesting new protocols doing reasonably sized DAO to DAO deals and I haven’t seen Nexus featured in their governance discussions, which is rather surprising.
Good examples would be the Tokemak project, I am in discussions with one of their team re protocol security and insurance cropped up. They are in negotiations with some fairly large DAOs (Sushi, Olympus, 3 others) to provide liquidity management as a service. This will involve substantial transfers of each DAOs native token to Tokemak in exchange for TOKE.
Olympus Pro is also offering liquidity management as a service by using its brand and processes to allow regular users to stake both sides of a Uni/Sushi pool and then surrender those LP tokens in exchange for a discount on purchasing Ohm assets. Ohm is working with several new DAOs including Alchemix to assist with their liquidity management. MakerDAO are doing a fairly thorough due diligence on Ohm as a result of being asked to participate in this process and again insurance hasn’t featured in that discussion.
Great point. I’m in talks with Maple to offer protocol cover for them.
Some way to offer a healthy commission on deals brought in is probably plenty to incentivize individuals to go about promoting Nexus in the DAO’s and other communities they are in.
Could easily be 100k+ for an individual on a decent sized protocol.
If someone brought in a 50M deal, that’s 1.3M per year in premiums. How much is that worth to us?
10% commissions seem fairly common in TradFi insurance. Presuming that, that’s a 130k commission
It’s easy to see how there is enough incentive to encourage people to promote Nexus.
Edit: One thing to keep in mind is that because we don’t currently sell protocol level insurance to protocols or DAO’s currently, they obviously don’t know this is possible. So when I chat to them, they’re generally excited. I think this is a large untapped market and while it’s hard to serve (large capital deployment required), particularly for smaller (under 200M TVL) protocols this could be the kind of thing that takes Nexus to the next level.
While we’ve had limited success with the DAO to DAO model in the past I definitely think now is the right time to revisit it, things have moved on and the landscape has changed. This is something it would be great for the wider community to support.
The existing Protocol Cover product can be bought by the DAO behind a particular protocol, so there is no need for custom wording in most situations. I can see some circumstances where this isn’t the case (eg Thorchain example) but for the moment lets assume the product is fine as is. In this case, the following steps are required:
Form community based group to lead DAO to DAO BD efforts
Identify most likely targets.
Liaise with Nexus core team (myself and @ricky) for listing if required.
Discuss and make proposals on DAO forums etc
Commission rewards for DAO working group.
On #5 - We’re building commission options into V2, but in the meantime I suggest the Community Fund can pay 10% of cover costs to the group of contributors in NXM terms (needs snapshot vote to approve) as an appropriate incentive.
Quick question because I know someone will ask this, is the 10% perpetual like in TradFi insurance whereby renewal premiums are also paid out to brokers? Or it’s 10% of the initial cover buy, then nothing after. This is still theoretical of course, I’m just asking to gauge your thinking.
Something like 10% of first year, 5% perpetual seems standard in TradFi but perhaps @BowTiedIguana might have more knowledge here.
I’ll just jump into the conversation and remind the community that once the first quarter of Mutant Marketing comes to a close (2 Nov), we will be focused on the 3rd Key Result: The DAO Coverage Campaign. We’re currently creating assets for this campaign and determining strategy.
As more DAOs diversify, hold productive assets, own their own liquidity, etc., they are taking on a good deal of risk with funds needed to ensure the future of their protocol. Since most DAOs don’t earn any or enough operating revenue to fund their operation, non-operating revenues are the lifeblood of a DAO treasury. Mutant Marketing will highlight some of these points, among others, and execute a whole campaign targeted at getting more DAO treasuries covered by Nexus. We’re the only DeFi coverage provider with enough capital to take on this task.
Well I wasn’t expecting to be offered a commission for this, but of course I’m still happy to help.
I am in contact with the core team at Tokemak (their developer was kindly answering some questions I had in connection with an article for the DeFi Education Substack) and I proposed Nexus Mutual as a good partner. Would like to move these discussions forwards from point 3 of your post.
I could make an initial contribution to any risk review as I have been reviewing the Tokemak protocol (along with DeFi Safety) and I understand that a Trail of Bits audit is currently underway and that will cover their off-chain logic also.
.
