Proposal: Add Bridge Mutual Coverage to Eligible ICHI Strategies

We propose enabling Bridge Mutual ICHI coverage as an available ICHI strategy.

What? Bridge Mutual (BMI) announced an ICHI coverage pool on (date). It enables people to purchase coverage on BMI’s platform for their ICHI positions. This helps protect against hacks, exploits, and rug pools. It also enables users to provide ICHI coverage and earn a share of premiums and BMI rewards. ICHI should admit a strategy that enables ICHI Stable Assets to deposit a share of their treasuries into the BMI ICHI Coverage pool and earn yield.

Why? The availability of coverage enables people to pay to further protect their ICHI positions. This reduces risks and increases TVL. In addition, the ICHI treasuries can earn yield by providing coverage liquidity.

What are the drawbacks? There is a risk of complete loss of any funds supplied to the BMI protocol. This could happen via a hack/exploit, governance attack, or rug pull.

There is a risk that it could delay withdrawals from ICHI treasuries. It takes a minimum of 8 days to withdraw from the BMI protocol. This could cause ICHI redemption delays if too much collateral is provided to BMI coverage.

Mitigation of Drawbacks: We will cap coverage provision to 10% of a Stable Asset’s collateral reserves.