InsurAce To Compensate 155 Investors With $12 Million For Their Loss In The Recent Terra Crash
The DeFi insurance company insurAce is giving out $12 million to 155 investors out of 178 as a compensatory fund to subsidize their loss as a result of the May Terra collapse.
As stated in the post InsurAce plans to compensate 155 investors a sum of $12 million as a result of the crash of Terra and its token in May.
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Terra May Collapse
It is worth noting that the crash was initiated following the de-pegged from USD and plunged below the 1:1 ratio which also result in the fall of its token from over $100 to almost zero. The crash was so disheartening to the Terra ecosystem and the whole crypto sphere as the collapse affected them and the crypto is just recovering from it.
However, the Terra Labs executive has been facing a lot of lawsuits as a result of the collapse, especially in South Korea and the US.
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As reported by Cryptolifedigital, As a result of Terra’s collapse, the South Korean institutional and retail investors lose a huge amount of capital. The cryptocurrency exchange in South Korea met and announced the plan to compensate the investors in that region.
The update released via IsurAce’s Twitter handle on the 1st of August stated that it has taken up the mantle to make the whole UST investors who had taken up insurance policies with it. It is worth noting that InsurAce debuted in the crypto market in April 2021 to provide risk protection services to the DeFi industry. This way, DeFi users can insure their investments against unforeseen risks like stablecoin de-pegs and bankruptcy.
In the course of the recent interview, the InsurAce CMO, Dan Thomson, revealed how the protocol’s timely helped aid the situation.
According to the InsurAce’s CMO;
“The main reason that our response was effective was because of how timely and efficient it was,”
He further stated; “On May 13, barely 48 hours after the $UST de-peg event, we released a statement to the press, to set the loss Claim process for $UST investors in motion. We published a user guide that provided clarity on Coverage specifications and Claims Eligibility. With a 7-day claims window, we set a goal to provide instant support to victims and send out a reassuring statement to the rest of the DeFi world.”
Terra Crash Was A Big Hit For InsurAce
The InsurAce took a big hit as a result as stated by the on-chain data. The report stated the protocol’s estimation in the de-peg claims is $11.7M while it only collected $94,000 in the premium payments.
To get this done, the CMO said InsurAce has deployed a community-driven approach, with its independent native governance token ($INSUR.) holders executing the claims assessment process.
Thomas said:
“The decentralized voting was conducted by InsurAce’s community of Claims Assessors who hold and stake $INSUR Tokens. And after the Voting process, they approved a total of 155 $UST de-peg Cover claims and 18 rejected as not ineligible in line with the Stablecoin de-peg Cover terms and conditions.”
“In addition to improving our risk management strategies, we have put some plans in place to mitigate the losses incurred by stakers. Over the next 12 months, A fixed sum will be paid into an on-chain pool from which stakers can withdraw their compensation. The staggered approach will help us ensure that we can help stakers to earn back some of their losses, whilst maintaining healthy liquidity in the InsurAce protocol.” Thomson concluded.
Facts About InsurAce
InsurAce has built a full-spectrum cross-chain product line that covers over 140 protocols, 3CEX and 1 IDO platform running on Ethereum, as well as Solana, BNB Smart Chain, Polygon, Fantom, Gnosis, Arbitrum, Avalanche, Harmony, Celo, Cronos, Boba, ICON, Ontology, Moonriver, Moonbeam, Bifrost, Aurora and Optimism. InsurAce.io currently has a live product deployed on Ethereum, BNB Smart Chain (BSC), Polygon and Avalanche.
Cryptolifedigital is a cryptocurrency blogger and analyst known for providing insightful analysis and commentary on the ever-changing digital currency landscape. With a keen eye for market trends and a deep understanding of blockchain technology, Cryptolifedigital helps readers navigate the complexities of the crypto world, making informed investment decisions. Whether you’re a seasoned investor or just starting out, Cryptolifedigital’s analysis offers valuable insights into the world of cryptocurrency.
