Overview
Insured Vaults are designed to extend the functionality of existing yield vaults by enabling users to cover their yield vault positions against losses caused by technical and economic risks on demand.
Specifically, Insured Vaults enable users to deposit (stake) yield vault shares to activate cover and stop coverage by simply withdrawing (unstaking). Premiums are streamed from the underlying yield while the yield vault shares are staked, eliminating fixed-term commitments and upfront prepayment.
Insured Vaults thus enable yield vault positions to be covered in a fully DeFi-native, composable manner for the first time while preserving the original yield vault as the primary point of deposit.
As such, Insured Vaults are intended to be integrated into existing frontends with native DeFi connectivity (e.g. wallets, protocol dApps, portfolio trackers) or be used programmatically (e.g. bundled onchain calls, backend workflows).
Accordingly, an Insured Vault user interface is to be customized by the integrator (see reference UI), with the only requirement that it support the Insured Vault lifecycle, including the asynchronous elements from the ERC-7540 Ethereum standard.
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