On the 2nd of August, we conducted our bi-weekly AMA on our Discord Voice Channel.
On the back of another record attendance, we have transcribed the audio and turned it into a blog post for your reference.
1 thing to note with this blog post. Due to technical issues with the bot, likely due to a 20-second delay before talking, we missed the first 10 minutes of the recording. Before the audio and transcript, below are brief notes on the missing audio:
- A brief introduction to who we are and what Amulet is. Also, just a brief mention that Rob is usually compere but today the team will take turns. In short, Amulet Protocol provides protection against potential exploits on digital assets through their cover options. Built on the Rust-based ecosystems, we have our testnet launch planned for this month and our mainnet launch pencilled in for the end of September.
- First question missing from the audio – is there a difference between us and traditional cover protection solutions? In short, yes. Our PCUV model is pretty unique and it redefines the entire cover protection model – something that even Lloyds of London used hundreds of years ago. Rather than payouts coming from Stakers, Amulet will build its own underwriting capabilities and introduce multiple layers of claims buffers to safeguard staked capital while providing claim payouts.
- Second question missing from the audio – How does Amulet protocol plan on generating income from its users? Our main three activities will include purchasing cover protection, staking within our dApp and earning through automation. The main source of income will be from purchased premiums as with others within the industry.
Audio File:
Transcript of Audio:
Rupert – Amulet
It is. Oh, apparently now we’re recording.
Rob – Amulet
Because it took so long, we’re gonna miss some of the audio on this. So that’s that’s annoying, but at least I spotted it during the AMA,
Rupert – Amulet
not to worry. So, in short, can we protect users in in massive crashes? Yes, we can. Obviously you have to have the cover bought before the potential crash happens is that I believe the cooling off period and Jimmy correct me if I’m wrong is about 14 days you have to have the cover in place for before the potential event you’re covering against could happen. If there are multiple crashes within a month. Yes, again, with Yeah, we are built and designed to handle multiple different, you know, cases crashing, or there’s multiple different policies being claimed in at any one time. And so that wouldn’t make any difference to us. Obviously, it wouldn’t make a difference. If there the entire Solana ecosystem was hacked overnight, and all funds were drained. That would be a black swan event, and that would, you know, kill Solana and colossal kill everybody in the whole ecosystem. So things aren’t infallible is what I’m trying to suggest the there is still risk in everything. We are designed to minimise the risk as much as possible. I think that answers some of the questions. Jimmy, any anything to add on that?
Jimmy – Amulet
No, no, I think I think that’s pretty good. I guess some of the other crashes that are happening in the ecosystem, like, you know, rug pulls and stuff like that we are probably not going to cover but if you’re talking about like bridges, like we just saw like the Nomad hack happen and we’re probably going to slowly make our way as you can understand, and very cautiously towards ensuring any sort of bridges bridges are and have been, like the largest source of losses and hacked funds. So we’re, we’re working on on it, trying to think through it, but it is difficult because of their vulnerability. So yeah, we’re actively trying to think through like crashes like that. But for now we’re going to stay focused and stay concentrated on the the right type of risks. Because I think Amulet and most covers like you can see it as like the financial safety net, or like the the last kind of layer of defence. And we want to be around when things go down, so that we can help protect the space. So we need to be pretty cautious about the risks that even we’re exposed to
Rupert – Amulet
A better way of saying it than me, right, That’s all from Teclosa, Devillove076. First of all, I want to say that it is nice to see how the project is gaining momentum and partners. The questions may be trivial, but it’s always interesting to hear live, the asset protection, we’ll have what kind of stock? Let’s just say on the amount of cover. Okay, I think this pertains to in terms of policies and what we can, what we can sell. So this all comes down to one how much state assets we have in our protocol. That’s one of our our limitations as to how much policies and cover we can sell. The other thing that it comes down to is the risk of each individual protocol and any particular leverage that is applied against that. And third, then our own capital acceleration programme, the cap, which can read in the document, which enables users to actually select what sort of leverage they want to provide for each individual protocol as well. So first off staking if we’ve got $1 million worth of staked assets, we can cover against $1 million worth of our policies going out. But then if we apply a leverage to that, let’s say two to one, we can cover against $2 million worth of policies out there. Now, it If we have two protocols, and each protocol has $1 million of, of policies out there, the likelihood of both protocols being hacked at the same time is very, very small. Then on top of that, you also have the liabilities within inside that. So let’s say, there is a hack of a protocol that has a million dollars worth of TVL. And we’re covering it for a million dollars. But not all their users have taken out cover that with us, let’s say 50% of them are taken out cover with us. So the actual only liability that we have is $500,000. And out of that $500,000, how many of those users will have the correct parameters in place in terms of has it been taken out, within 14 days of the product collapsing? Has did they store the assets in the way as per the contract, and other parameters that we put into the contracts in order to make people safe on our protocol and another’s, then there is a certain amount of of assets that will end up paying out. So it might be that on any given protocol. If we were covering for a million dollars, there may only be $250,000 worth of payouts after all of that has come to light, ie the protocol has been hacked, it’s been hacked in this way, we’ve got this amount of users that are covered, these amount of users are eligible. And the total figure that is finally eligible on all that those are all examples. And that there is no hard and fast rule in this we are working this out protocol by protocol as we go. But the point is we’ll always have assets to cover our liability. What we the way in which we generate capital and way in which we generate returns back to our users is by using those assets to cover multiple different protocols all at the same time. And so what we are aiming to do at any one time is that if one protocol gets hacked, we have total coverage on that. But if we had, you know, recovering temporary articles, and all temporary articles got hacked at the same time, that would be a black swan event, as we explained before. Is that fair enough to say Jimmy? Yep, you got
Jimmy – Amulet
it. Just to break it up? Maybe I’ll ask some other questions, and you can answer.
Rupert – Amulet
Are you on the devil love section? Yeah. So
Jimmy – Amulet
this one’s pretty easy, what led you to create this project?
Rupert – Amulet
So it’s pretty cool one actually, I have been thinking about cover options for a very long time. So prior to this, I had a FinTech called Pink. And pink was a FinTech that used crowd wisdom to identify a portfolio of assets in crypto and in traditional assets as well. And we ended up pivoting into regulated assets and I was fairly desperate to get back into default with able to x out my business last year. And at that point, I was able to kind of reignite some my thoughts around cover, we some of the areas of cover that were ripe for disruption and ready to fix. And coincidentally at the same time, a friend of mine was working at a different cover protocol. And he said, Hey, come over and talk to us about this. So we can you know, see what the you know, the potential problems that we’re facing with inside DeFi and ensure the result of those conversations was us creating what is now amulet. And you know, we’re here to solve problems in DeFi Cover. But more broadly than that, we’re also here to solve problems in risk protection full stop. I said, That’s the easiest answer.
Jimmy – Amulet
Nice, nice. So I think this is just like to to follow on questions that are probably related. Why do we think emulated is a necessity. And what difficulties have we encountered so far?
Rupert – Amulet
It’s an absolute necessity. $12 billion was stolen last year out of the whole of web three, excluding the exchanges, we generated about $24 billion worth of revenues. 50% of it went straight out the door to hacks. So anybody who can who says they could argue that amulet isn’t a necessity, is in fact, just wrong. And risk protection e is a total necessity in this business. And the people that are driving that argument are all the funds themselves, you know, BlackRock, JP Morgan Goldman’s, they all want to be in the space that all regulated but they’ve got to have, they’ve got to protect their clients funds as well. So they’ve got to have protection in place. So there is no denying that that cover is necessary. And in terms of what difficulties we have encountered. I think like building any startup has its troubles. And quite often they are, you know, all connected together, we have the same kind of staffing issues, we have the same hiring issues, you have the same kind of growth pains and stop and start issues that any company has. But when it when I think about like the main problems that we have encountered as a team right now, they’ve all been really easy to overcome, because we have got very good, strong team and and yes, I’m biassed and very bullish. But so far, there’s nothing really that’s that’s stopped us in our tracks, although our can crashing doesn’t help. Well, it doesn’t have no but it hasn’t stopped. That’s mean, we we raised a really strong round, which is all over the press anyway. And you know, we’re in a really strong position to build this. And guess what? But yeah, it certainly didn’t, didn’t didn’t help. But it hasn’t stopped us. Now is the time to build now in my opinion. Awesome,
Jimmy – Amulet
awesome answer. Yeah. Totally agree with that as well. Just for sake of time, keep keep, keep it moving here. Is it difficult to recruit partners or projects speak for itself, more the latter. So definitely pretty easy to partner with a bunch of different protocols. I think everybody wants to be quite secure and wants to protect all of their users. That was like a really, really great thing for us to see. Like, as we’re like talking to more and more projects, everyone’s like, Oh, hey, like, yeah, we we should definitely be doing that. And so we’re talking with different protocols thinking about like, how to integrate, at, like, within, like each of the different apps. And so, you know, you could be going on whichever fi protocol use the most. And when you stake or when you own stake, when you deposit funds, we want there to be a button there that says, hey, like, let’s, let’s get you some cover. And that’s not to say that the protocols themselves don’t trust, kind of the work that they’ve been doing. It’s more so just the fact that like, no matter how much, no, and who audits you, and how many audits you go through, you’re still vulnerable to different attacks. So you know, I’m sure the all the folks who have been been hacked, can can probably attest to that. Like, it’s it’s really difficult to build a project and to to keep it secure. So just more levels of protection for users is always kind of better. And yeah, again, just happy to see that, like most of our partners see it the exact same way. And I would think and I suspect that most of the Solana ecosystem also thinks the same way as well.
Rupert – Amulet
Good answer. I was gonna ask the next question to you. What can you say about the community that supports you
Jimmy – Amulet
bullish, to the moon, not financial advice. Yeah, I think pretty much just said it. But worth I guess, saying again, everyone sees all the kind of the hacks that are happening in the space they see kind of the scan zand I think everyone’s kind of fed up. And they they want to support, like projects that are trying to do like better into the space and trying to build out like kind of the ground. groundwork and the foundation so that like the next generation of like crypto users and defy users who come into the space, don’t have to constantly be trying to dodge drugs. Because you’ll you’ll know, okay, if this project has been covered by by amulet, then you know, it’s probably a pretty safe project and lower chance of a rug. Right. And so we’re, we’re extremely proud of the work that we’re doing. And we’re, we’re bullish.
Rupert – Amulet
And, you know, from my point of view, I really love this little community that we’re building at the moment. I mean, it’s, there is only a few of us there, it is growing. And I think, once the product is live is going to start growing at quite a pace. I, the next few questions are all about community as well, in terms of what do you want us to do and want to see and see from us, and how each member of the community can support us. And really, you’re gonna see, we said that in the last AMA, and I think probably the one before that, but really, I promised, like, very soon, we’re about to re releasing our latest product to engage the community. And if you guys can all engage with that and utilise it, you’ll be rewarded for one. And two, it will really help us as a project. So it’ll be about telling your friends, it will be about tweeting about us, creating videos about us, all of these things you’ll be getting rewarded for. And that really, really helps and supports us and we massively massively appreciate. Appreciate it. And it’s a Yeah, it’s really exciting to see everybody getting on board and getting behind this. The cover I’ve said before, is the most undervalued section of the whole defy industry. And we are absolutely gonna smash the hell out of the park if we have a strong community.
Rob – Amulet
What other questions even though my mouth hurts, I’m just going to add something because I noticed that it says, do we watch our work in person? And because we’ve got quite a few of them today, I will sacrifice my pain to talk to say that definitely. I know pretty much what each and every single one of you does. So I could look into this chat now. And I can see like facreal I’ll always comes to our AMA’s Ilya translates all my blog posts that I write in. For the Russian language community. I can see Nikolay very always on the Russian chat. I can see Sanya and the meme King, though for sure. I definitely know there’s pretty much everyone that I am aware of. I will I know on the top of my head, so it will you’ll definitely be rewarded. And I’m definitely watching what you’re doing.
Jimmy – Amulet
Big Brother is watching
Rupert – Amulet
Massive thank you guys. Huge chunky. Jimmy, what was the next question?
Jimmy – Amulet
I think we already answered how the mechanism of like amulet works. So I think we can skip that one. The next one is will we wait for interaction with defi projects? And will the amulet be able to save depositors money? And how do you see amulet in the next five years?
Rupert – Amulet
We got three, do you want to take the first bit?
Jimmy – Amulet
Yeah, I’ll take the first bit try to maybe try to answer all of them in one go. But in terms of like interaction with other defi projects, like I said, we are thinking about how to integrate like directly with them on their, on their daps. So that that’s coming soon. But when we go live, you’ll be able to purchase cover directly from us. Like through our platform, and we will be listing like the different projects directly on our platform. So in some ways, no interaction is necessary. But we we will be doing it because I think it’s better to get in front front of those communities. Will Emil be able to save like depositors money so I think this is appointed to make clear, we’re trying to help protect you when you use other defy projects. Right? So if you’re depositing into say Solon or something like that Um, and you’ve got funds there, you come to us you purchase like smart contract cover, then you know, we are going to protect you in the case that like Solon gets hacked. Right. So, yes, we are protecting your funds. And lastly, where do we see ourselves in in five years? I can’t even tell you. Because five years is like, what, like 50 years and in crypto timelines, and so hard to hard to say, we do have like aspirations to have more products. First off, I think there’s there’s a lot to be done for kind of gaming and NFT space. And we’re, we’re working out a solution there. Protocol, what else will be on the moon? Yeah, you take this one?
Rupert – Amulet
You know, I think I’ll be I’d grown up in five years time. I’m not quite there yet. But in any case, no, in short, my, my aspiration for the protocol and the community is that we are, you know, within the next one year, we are the largest DeFi cover protocol by none. And then we build upon that. Yeah, that that is our, that’s our basis, and then we are able to grow hope, I would like to see that we dominate and control the market for the next five years, with then getting legs into the real world as well. That would be interesting. It’s not a fixed direction. But yeah, certainly, when Jimmy’s referring to new products, we have a huge ambition to grow this into, you know, the largest cover company in the world. Of course, that would that would be the North Star. But, you know, everything starts with small acorns. And we’ve got a real opportunity to dominate in our small network right now. And then grow much, much faster and beyond that.
Jimmy – Amulet
All right, next one will launch. Yeah, yeah, lots of lots of ambitions. And speaking of that, I think Meison’s next question is pretty relevant. What blockchains in the future other than Solana are interesting for the project. So in short, we are looking at all like Rust-based chains so you know we’re looking at like Cosmos Polka dot, Yeah, Near sorry. We’re yeah, those are like probably the hottest ones in terms of like how we’re going to evaluate like which ones to move into it’ll be based on user’s emergence of of defy like on those specific chains and compatibility with with our core offering and PCUV So yeah, that’s that’s the future expansion plan but we do want to be like a multi chain project and we do want to be pretty much like anywhere in everywhere we want to cover the whole space right? So that’s the that’s the grander ambition so staying I think tied to one particular chain is not the not the vision we want to be everywhere where users are
Rupert – Amulet
Who do you see the main competitor of Amulet if any? What are the amulet advantages? Do you want to take that one Jimmy we’ve got the second part I feel like we’ve answered that
Jimmy – Amulet
Yeah, yeah for sure. So right now if you were talking about like direct competitors like on Solana there’s there was none there there is no other DeFi cover project on on Solana if you’re talking about the broader DeFi cover options space there’s kind of the first like oh geez and space or Nexus mutual right behind them, InsurAce, Nexus or sorry Unslashed Yeah, Risk Harbor . So there’s a there’s a couple that are out there. But we all have our own kind of different take and those those other protocols that are mentioned are I’m kind of confined to EVM chains. And so we definitely have, like carte blanche and like a blue ocean opportunity in front of us right now.
Rupert – Amulet
Will there be a list of restricted countries? Or will amela be available all over the world? Yeah, I think
Jimmy – Amulet
there is not, at the moment list of restricted countries. Having said that, we would not be surprised if different regulatory bodies or, or folks start telling us like, hey, we you can’t be operating here. And so we will have to maybe eventually geofence the protocol. But the goal ultimately is to be available worldwide, right? Like crypto and defy is a global movement. It’s not constrained to one particular country. And so we would hate to have to exclude anyone from this. But having said that, if we are in trouble, we are doxxed. And so we don’t want to go to jail. And we’ll probably have to play by the rules, some rules. But yes, we will try to be available all around the world for as long as possible.
Rupert – Amulet
In the in the words of Daft Punk around the world, you’re gonna have to look it up if you don’t get a reference. Anyway, that is the end of all the questions that we have right now and then we’ve gone well over on time. I’ll happily stay on for another five minutes or so. If there’s any questions in the audience. If you’d like to ask, either on the AMA questions channel, or just come off mute, and ask away. See gaff is off mute. I don’t know if he doesn’t necessarily want to ask question duck. You’re off mute. Did you want to ask question? No, there he goes. He’s hiding away ducking down. If there’s no other questions today, then I will wrap that up. You’re getting a final note. Nobody’s coming. I think that’s the end of it today, Jimmy. All right. There is nothing for Shin Shin arrived, has been diligently sat there sorry, buddy.
Shin – Amulet
No worries. When a product there’s gonna be more
Rupert – Amulet
products good. All right. Well, look, thank you very much for everybody that joined today. If you have any further questions, please hit them up in the AMA questions channel and we will endeavour to answer them in two weeks time. Otherwise, we’ll see you back here in two weeks time. And in the meantime, have a great rest of your day. Good morning. Good afternoon. Good evening. Good night. Bye, guys.