However, two key issues still stand – usability and smart contract risk.
Tackling the matter is saveDAI, who have just announced the creation of the first insured interest-generating DeFi token.
The easiest way to open an insured high-interest savings account — possibly ever in the history of the universe @save_dai is coming soon to a phone or computer near you!
What is saveDAI, and how does it work? A thread:
— saveDAI (@save_dai) February 29, 2020
saveDAI not only aims to make DeFi lending accessible but adds in an invaluable element of protection and insurance against smart-contract risk.
How Does it Work?
As a refresher:
- cTokens are interest-generating tokens, representing a claim on an asset lent via Compound plus interest earned. In this case, cDAI entitles the bearer to DAI in Compound, plus interest earned on that DAI.
- oTokens are tokenized “insurance contracts”, from Opyn’s Convexity protocol. These provide protection against technical, financial, and administrative risks on lending products. In this case, ocDAI provides insurance against issues with DAI deposits in Compound, or cDAI.
By combining the two assets into one, saveDAI has produced a new type of DAI-based token. As a result, saveDAI earns interest via Compound, but also insures against the risks associated with the platform.
Although this combination of tokens could be purchased manually, saveDAI significantly streamlines the process.
Aside from “baking” insurance into its token, saveDAI also makes it easy for non-technical users to participate.
Users can connect by using Authereum, a web3 wallet which requires little more than an email address to set up. Authereum also provides a quick fiat on-ramp via Wyre, enabling users without crypto to purchase some with Apple Pay, Google Pay, or credit card.
More about saveDAI
saveDAI began as a hackathon project at the Ethereum Denver convention earlier this year, with the concept’s origins extending back into late last year. It appears that saveDAI will be focusing on accessibility to users via both mobile and desktop.
The project hasn’t launched yet, however you can stay up-to-date with their progress on their Twitter feed.
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