Web3 Platforms Could Improve User Experience with Insurance from Security Breaches

온라인 슬롯 사이트

The Web3 and blockchain ecosystem continues to evolve rapidly, however, these platforms have been targeted by numerous hacks, damaging security breaches, and other types of malicious activities. For these reasons, industry professionals have considered requiring crypto service providers to provide insurance from hacking incidents.  

 

Although Web3 is still in its early stages of development, there are many reports of unknown vulnerabilities that tend to be more sophisticated and damaging than those found in the traditional finance or TradFi space. Due to these issues with DeFi platforms, it could be worth considering insurance options for clients, but then the burden of offering such support would fall primarily on the platforms. However, a properly implemented solution could help users take out insurance to protect against malicious hacks carried out by bad actors. 

 

Crypto Platforms Can Achieve Mass Adoption with Insurance Protection

Currently, there are various types of insurance packages available to cover losses, but it is also worth looking into what potential impact these additional costs of insurance may have on platform profitability. It’s also worth exploring whether platforms could even afford such support services completely on their own. 

 

Notably, some platforms, such as , are community-focused and are proactively pursuing insurance as a viable option. The team reveals that they are planning to get insurance coverage for the decentralized protocol so that clients are always protected against hacks and other forms of abusive activities.

 

In addition to these features, the team is reportedly working on the integration of the Options protocol for enhanced risk management and yield protocols such as OpenEden for capital efficiency. For additional context, the Kunji protocol provides an innovative solution where the asset managers actively manage funds without actually taking custody of the users’ funds. 

 

The team explains that digital asset yield-based protocols tend to provide significantly lower returns, while long-only rebalancing strategies do well in very specific market scenarios. The platform supports discretionary long and short strategies through the seamless integration of spot and derivatives exchanges. This enables digital asset managers to deliver alpha with advanced risk management. Importantly, clients are always able to safely withdraw their funds at any particular time since the platform does not have access to clients’ private keys.

 

Robust Security for Crypto-Asset Portfolios

It’s evident that this type of platform design offers improved security and accessibility. However, it is still imperative to safeguard user assets. For extra protection, insurance packages can be offered to clients so that their valuable funds are protected from malicious hacks. As widely reported, the crypto space regularly experiences a wide range of hacking incidents – which has led to losses worth billions of dollars according to blockchain firm Chainalysis.

 

Digital security firms like CertiK have also revealed in multiple reports that the crypto-assets space is always susceptible to sophisticated hacks which are often carried out by exploiting vulnerabilities in poorly-coded smart contracts. Due to these persistent threats, crypto professionals now recommend acquiring some sort of insurance against hacks. Somewhat similar to how insurance services protect client assets in the TradFi space, the decentralized finance (DeFi) industry could also benefit from reliable insurance options.

 

Crypto Insurtech Solutions Could Streamline Digital Asset Services

With the adoption of these Insurtech solutions, crypto and Web3 service providers could gain the confidence and trust of investors. It could also allow the nascent blockchain sector to grow in a more sustainable manner. It’s no secret that a damaging security breach like the one that impacted Bitfinex back in 2016 and even Binance in mid-2019 have had long-lasting negative impacts on investors. For this emerging sector to grow and become a more prominent industry, more firms need to come forward like the Kunji Finance team by working on an insurance services package.

 

As one of the most innovative crypto-asset management companies in India, Kunji is reportedly backed by a team of experienced professionals. For investors to feel comfortable, the platform supports the monitoring of investment portfolios 24/7. The service provider has also implemented institutional custodial solutions, so that user funds remain secure. This security feature is supported by advanced hot (online, connected to the Internet) and cold (offline) storage services. The Kunji team explains that they provide convenient access to liquid assets and withdrawals whenever clients need them.

 

Another important part of the platform is its trustless design. The developers have implemented actively managed crypto investment strategies, but they do not store private keys that provide access to users’ funds. This non-custodial design can prevent malicious third-parties or the platform managers themselves from stealing client deposits. Given the spectacular collapse of centralized platforms like Celssius and FTX, it has become critical to implement decentralized services – which can ensure consumer protection.