Balancer <> Sherlock Insurance Collaboration Grant Proposal
Work towards insuring Balancer pools with Sherlock – a DeFi insurance protocol that covers DeFi projects wholesale.
Start by insuring one test pool for Balancer in the short-term and eventually all TVL in Balancer contracts.
DeFi insurance has a bad name because all existing protocols fail on two major dimensions:
- Pricing: Insurance is unaffordable for users and protocols alike.
- UX: Figuring out how to buy insurance (amount covered, length of coverage, etc.) is a massive headache for the average user.
Sherlock solves this by partnering with protocols directly (users don’t need to buy insurance) and utilizing our team of smart contract security experts who price protocol risk.
For more info, here’s a high-level summary of how it works:
Sherlock makes DeFi a safe place for the unsophisticated user.
Audits have been unsuccessful at preventing hacks (and they don’t even try to assess most true protocol risks).
Existing insurance has been unsuccessful at bringing coverage to the masses due to unaffordability and bad UX.
With Sherlock, Balancer decides which risks it wants coverage for and how much coverage (which pools) it wants. Sherlock’s team assesses Balancer’s security risks and prices the coverage for Balancer as a % of the value to cover. Balancer pays a small % fee (block-by-block) to Sherlock and Sherlock guarantees full payout on hacks at Balancer (in accordance with the coverage Balancer chose).
Sherlock is going live on mainnet in 6-8 weeks after extensive auditing. There is already a waitlist of protocols who would like to buy coverage (including a handful of top 25 protocols by TVL). If Balancer and Sherlock come to an agreement on value covered (and rough pricing), there’s no reason we can’t have a test pool being covered 10-12 weeks from now.
Sherlock live on mainnet.
Sherlock <> Balancer test pool goes live.
Sherlock and Balancer agree to insure a material amount of TVL for Balancer.
If Balancer has serious interest in this type of insurance, we are happy to whitelist our protocol design and Solidity code for interested parties to review (before mainnet launch – these will be public after launch). We have a V0 implementation at auditsrdead.com on Kovan but we no longer maintain it as we are working full-time on the mainnet implementation. You can also find us on Twitter @Sherlock_DeFi.
We are looking for 10k USD which would go directly to helping Sherlock build out a dedicated security team for Balancer to price Balancer’s insurance and then to continuously assess Balancer vulnerabilities/risks. (The team will then be paid out of Balancer insurance fees after the test pool is completed.)
Jack Sanford (full-time)
Role: Biz Dev / Full-stack
jack__sanford on Twitter
jacksanford1 on GitHub
Qualifications: Financials sector analyst at Citadel for 2 years, Investment Banker at Morgan Stanley for 2 years, full-stack developer
Evert Kors (full-time)
Role: Backend / Smart Contracts
Evert0x on Twitter
Evert0x on GitHub
Qualifications: 4 years as Solidity dev, wrote mainnet contracts for PieDAO ($25M TVL)
Vincent Schut (part-time)
Role: Frontend / Design
flessendop on Twitter
flessendop on GitHub
Qualifications: 3 years experience as a frontend dev
Please feel free to reach out with any questions or comments! Can also find me at jsanford9292 on Telegram.