Insurance is a very complicated area. Theoretically, you can insure anything from any risk: there is even exotic insurance against alien abduction. However, in practice, more practical types of insurance for the main property and other risks are much more often used.
Because of cryptocurrencies today – the most “hot” asset, as well as the most controversial, where it is possible to increase their investments or lose everything in one day quickly. At its core, the cryptocurrency market is a financial market, and the same mechanisms operate on it. Nevertheless, today, the number of participants in the crypto-market and its volume has become more significant. Since the capitalization of the cryptocurrency market has increased several over the past years, the issue of insurance has become relevant for a large number of people.
Insurance in itself is not a vital tool. The need for it arises when the policyholder has financial surpluses that can be used to ensure stability and protection against accidents. It is not necessary to be a billionaire to want to insure yourself against all kinds of losses, all investors want stability and confidence in the future. Nevertheless, they depend on the market price that they cannot predict. The impossibility with any probability to predict the financial future has led to the creation of some way of insurance, that is hedging (insurance of financial risks from exchange rate volatility).
Derivative financial instruments (derivatives) based on cryptocurrencies are in demand now more than ever, and their development is only accelerating, as many companies and individuals rely on long-term prospects of cryptocurrencies, hoping that their value will continue to grow. However, with the advent of the project BITRUST, crypto holders will have the opportunity to protect their investment without exit in the Fiat. The BITRUST platform will provide an opportunity to protect cryptocurrencies and reduce the risks associated with high volatility. The aim of the project is to create an insurance platform that will serve retail cryptocurrency investors with an average monthly trading volume of from 100 to 100 000 US dollars.
High risks on the crypto market associated with several factors:
- the high volatility of cryptocurrencies;
- the presence on the market of a variety of fraudulent schemes (Scam);
- the saddest thing is the lack of risk hedging instruments, as in the stock markets, while tokens cannot be insured under the law of the vast majority of countries, because they are neither property nor money.
Imagine an affordable, decentralized, easy-to-use peer-to-peer platform with transparent automatic execution based on Ethereum's smart-contract technology. With BITRUST, everyone will be able to conclude an insurance contract on agreed terms. BITRUST is an online marketplace that is currently developing by BTF Project Limited, registered in the UK and is expecting to be operational by January 2019. The platform will become the central platform where the insurer meets with a trader who wants to insure a certain crypto-currency position. Each smart contract can include two or more parties, and it works as follows:
For example, I would like that against the ETH (worth $ 700) the price would drop by 30% against the BTC for 120 hours. I am willing to pay in digital currencies the equivalent of $40 as insurance and demand the equivalent of $100 if the price drops to $490 or below. Then my colleague must agree to these proposed conditions or make a counteroffer offering slightly modified terms.
We then record our agreed amounts in the BITRUST smart contract. I'm blocking the equivalent of $ 40 (insurance value), and my partner is blocking the equivalent of $100 (insurance body). The final smart contract BITRUST will be equivalent to 140 us dollars.
After 120 hours, if the ETH token drops 30% against the BTC, the BITRUST smart contract executes the pre-negotiated deal and sends me the equivalent of $140. Otherwise, the equivalent of $140 will send to the other side. The buyer and seller of insurance block their funds in BITRUST tokens (BTF) or other cryptocurrencies that will be allowed by the BITRUST platform. However, there is great motivation to use BTF in particular.
The idea of creating insurance opportunities for the crypto industry has recently become particularly relevant. Repeatedly, we have witnessed the collapse of crypto-businesses due to hacking, code flaws, and human negligence. All these factors constrain the development of cryptocurrencies and blockchain, as well as discourage new participants. A fertile ground for the development of the BITRUST project will undoubtedly be the growing, modern and huge cryptocurrency market, which also needs insurance of accounts, transactions, and risk hedging. The insurance industry is inevitably moving in the field of crypto-economics because this area needs protection from risks. History shows that such risks are more than real, so the product that allows you to manage these risks will great demand.
I hope, soon, we will also see platforms providing insurance of crypto-wallet from hacking or insurance of funds on a cryptocurrency exchange – insurance case, there may be a break-in, the closure of the exchange or similar event. Finally, just insurance of an individual who has access to an impressive amount in the form of cryptocurrencies – in case, suddenly this person is kidnapped, for example. Things happen.
Learn more about BITRUST:
Website - https://bitrust.co.uk/i
Whitepaper - https://bitrust.co.uk/files/whitepaper.pdf
BitcoinTalk Ann - https://bitcointalk.org/index.php?topic=3217705
Twitter - https://twitter.com/BTF_PROJECT
Facebook - https://www.facebook.com/bitrustproject/
Telegram - https://t.me/bitrustico
Reddit - https://www.reddit.com/user/BITRUST/
My bitcointalk profile: https://bitcointalk.org/index.php?action=profile;u=1286131
Bountyhive: SofaSh