Trusted

Opium and UMA Unveil DeFi Insurance for SpaceX Launches

2 mins
Updated by Kyle Baird
Join our Trading Community on Telegram

In Brief

  • Launch failure insurance derivatives for SpaceX clients.
  • Optimistic oracles used for fast, low-cost transactions.
  • OPIUM and UMA prices see solid gains.
  • promo

The decentralized finance (DeFi) synthetic derivatives Opium Finance protocol has entered into a partnership with Universal Market Access contracts platform UMA. The aim is to launch decentralized SpaceX insurance using UMA’s Optimistic Oracle.

In an announcement on May 24, Opium stated that its decentralized insurance contract (CDS) will work in tandem with UMA’s oracle solution to bring real-world data to the blockchain.

There was a surreptitious Dogecoin plug in the tweet that also tagged SpaceX founder Elon Musk.

“We’d joined our efforts to launch a new ‘cosmic’ product – decentralized insurance on SpaceX. Hope @elonmusk will take it to the moon together with Dogecoin.”

DeFi insurance for failed launches

The derivatives work as binary options contracts, allowing users to purchase insurance against a failed launch on SpaceX. Using the SmallSat Rideshare program, organizations can send lighter and smaller payloads to space for as low as $1 million.

The announcement elaborated:

“The financial instrument can be used to hedge financial risks related to the SpaceX launch and even to generate some income.”

The derivative seller essentially offers insurance coverage for a failed launch by locking an amount of money as collateral and earning a premium in the process. These DeFi derivatives allow for risk management and speculation in a globally accessible and non-custodial manner, it added.

SpaceX already offers insurance at around 5% of the value of the payload, and Opium and UMA are attempting to compete with that.

To ensure high-speed, low-cost transactions, the offering will utilize UMA’s Optimistic oracles.

Just like Optimistic rollups, the Optimistic oracle operates on the assumption that one party sends a request and another party pushes the answer on-chain. Disputes can be raised if either party thinks there is something wrong, otherwise the transaction is completed quickly and with minimal network fees.

Opium, which offers a range of leveraged derivatives, launched TurboETH trading in late April to offer higher risk exposure to Ethereum markets.

OPIUM and UMA price reaction

Opium’s native token of the same name has surged 24% over the past 24 hours at the time of press, reaching a price of $3.68. The token is still way down from its $23 all-time high on Feb. 4, however.

UMA has also gained well today with a 13% increase to reach $13.46. It too is a long way down from a $45 ATH in early February.

🎄Best crypto platforms in Europe | December 2024
eToro eToro Explore
Coinrule Coinrule Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
3Commas 3Commas Explore
🎄Best crypto platforms in Europe | December 2024
eToro eToro Explore
Coinrule Coinrule Explore
Uphold Uphold Explore
Coinbase Coinbase Explore
3Commas 3Commas Explore
🎄Best crypto platforms in Europe | December 2024

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

profile.jpg
Martin Young
Martin Young is a seasoned cryptocurrency journalist and editor with over 7 years of experience covering the latest news and trends in the digital asset space. He is passionate about making complex blockchain, fintech, and macroeconomics concepts understandable for mainstream audiences.   Martin has been featured in top finance, technology, and crypto publications including BeInCrypto, CoinTelegraph, NewsBTC, FX Empire, and Asia Times. His articles provide an in-depth analysis of...
READ FULL BIO
Sponsored
Sponsored