We are proud to announce that we have made an investment into the upcoming DeFi risk market platform, Bright Union.
As an upcoming aggregator for decentralized risk coverage solutions, Bright Union aims to make taking out and investing in risk cover a standard practice among crypto users and firms.
The Need For DeFi Protection
For all its promise and potential, the cryptocurrency industry remains somewhat of a wild west for investors.
Though there are dozens of highly secure platforms and more emerging each day, many of which offer much-needed functionality, there are also a huge number of platforms that aren’t quite up to par in terms of security. Nonetheless, people continue using these platforms due to the utility they provide.
Unfortunately, when combined with increasingly sophisticated hackers incentivized by insecure smart contracts potentially holding millions of dollars worth of user assets, it isn’t uncommon to see DeFi protocols being hacked.
In total, close to half a billion dollars have been stolen from users in 2021 alone — of which more than $80 million was lost due to DeFi-related fraud.
Though these hacks are generally restricted to newer, less secure platforms, the frequency of these events poses a major barrier to entry to the DeFi ecosystem — as investors are increasingly wary of interacting with DeFi applications.
Nonetheless, a range of decentralized insurance solutions has appeared in recent months, which aim to allow users to take out coverage against a plethora of potential events — such as smart contract failure, hacks, or insider thefts. But right now, these platforms lack sufficient liquidity and make it very difficult for risk buyers to diversify their investments, reducing their desirability.
Likewise, the growing range of decentralized insurance products can vary considerably in their cost and coverage, making it unnecessarily difficult to identify and choose the best policy. This adds an unnecessary hurdle in a sector that is just beginning to pick up momentum.
Bright Union’s Solution
As a decentralized risk product aggregator, Bright Union collects the different coverage products available on a range of decentralized insurance platforms — such as Nexus Mutual and Bridge Mutual — and makes them available through a single user interface.
This allows users to easily search and select the insurance product that best meets their needs based on premium price and coverage details.
This too goes for risk buyers, who can search for risk products to invest in or maximize the utility of their capital through the Bright Risk Index (BRI). This is a collection of indexes for different risk appetites which helps users spread their investment over a basket of risk products as opposed to a single risk as is standard.
Through the Bright Risk Index, Bright Union not only solves the problem of liquidity for decentralized cover products, but also helps risk buyers diversify their investments based on their risk appetite (e.g. high, medium, or low).
Bright Union will also create an internal marketplace for wrapped risk coverages, where members can buy and sell NFT-wrapped risk products on an open market as per their needs. This will be combined with a powerful DAO-governed treasury system, which can be used to support premium products and allocate capital where it’s needed in the Bright Union ecosystem. Meanwhile, participants will share in the fees that are funneled back to the treasury.
The platform is backed by the BRIGHT utility token, which is used to participate in the Bright Union DAO and gaining priority access to Bright Union products, among other things.
Why We Invested?
At Master Ventures, we believe that in order for decentralized finance to become a viable alternative to traditional finance (TradFi) or centralized finance (CeFi), then it needs to be both accessible and desirable.
Accessible in that both casual and experienced users can get to grips with it, and desirable in that people believe the risk to reward ratio in using these platforms is acceptable given their benefits.
One of the best ways to achieve this is through widespread risk coverage. By giving users a way to easily take out a policy to protect themselves against a range of potential threats, we believe Bright Union helps to dramatically boost the desirability of DeFi.
After all, in everyday life, people take out insurance against a range of potential events — whether that be health insurance, travel insurance, or product cover, most people are accustomed to insuring against risks. But this element has been sorely lacking in crypto until very recently.
“By keeping the costs low while maximizing liquidity for both coverage takers and makers, Bright Union helps to tackle a major bottleneck in the DeFi risk coverage space,” said Master Ventures CEO Kyle Chassé. “We think once people realize the merits of DeFi cover, it will become a staple investment for many cryptocurrency and DeFi users.”
Backed by a heavily experienced team hailing from the traditional insurance sector, a clear market fit with a strong product and aggressive development roadmap, and sustainable tokenomics and stakeholder incentives, we believe Bright Union has an excellent shot at long-term success.
About Bright Union
Bright Union is launching the world’s leading aggregator and accelerator for the crypto risk markets. Its mission is to make the crypto risk markets work. Through Bright Union’s decentralized crypto coverage platform, crypto users can cover their assets, stake and cover the community, and earn guaranteed yield through Bright Staking with embedded coverage.
About Master Ventures
Master Ventures is a blockchain-focused venture studio helping to build the next generation of blockchain-based Web 3.0 system innovations within the crypto industry. Launched in 2018 by Founder and CEO Kyle Chassé, the company’s ethos can best be summarized in the acronym #BeBOLD: Benevolent, Open, Love, Decentralized.
Master Ventures co-creates with entrepreneurs and businesses worldwide to turn the best ideas into innovative and disruptive products. They do this by investing as strategic partners through offering advisory services to the projects they believe in. To date, Master Ventures has invested in over 40 crypto projects, including the likes of Kraken, Coinbase, Bitfinex, Reef, DAO Maker, Mantra DAO, Thorchain, and Elrond.
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