Capacity Limits

Available Cover
The mutual places capacity limits on the amount of cover that is available on specific risks. These exist to protect the mutual as a whole from being too exposed to any single risk it takes on. The are two limits, a Specific Risk Limit based on the amount of staking on a particular risk and a Global Capacity Limit based on the overall capital resources of the mutual. The lower of the two limits applies in each case.
Specific Risk Limit
Capacity on any particular risk is limited by the amount of staking on that risk. If there is no staking, the mutual cannot offer any cover.
Specific Risk Limit is equal to :
capacity factor x net_staked_NXM
net_staked_NXM as per the pricing section above
Members passed Proposal #149 and increased the capacity factor from 1x to 2x for all platforms unless defined otherwise in the list below. 
Protocol
Factor
Aave V1
4
Argent
4
Balancer
4
Compound V2
4
Curve All Pools (incl staking)
4
Gnosis Multi-sig
4
Gnosis Safe
4
MakerDAO MCD
4
RenVM
4
Set Protocol V1
4
Synthetix
4
Tornado Cash
4
UMA
4
Uniswap v1
4
Uniswap V2
4
Yearn Finance (all vaults)
4
Global Capacity Limit
This limit is based on the financial resources of the mutual and is there to ensure the mutual is not overly exposed to any particular risk, regardless of how much is staked:
Global Capacity Limit = MCReth x 20%
where:
MCReth is the Minimum Capital Requirement in ETH terms.
More detail about the Minimum Capital Requirement and our assessment of the correlations between protocols and custodians is available in the Capital Model section below.

Cover Pricing

Minimum Capital Requirement

Last modified 8mo ago

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Contents

Available Cover

Specific Risk Limit

Global Capacity Limit