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Opium’s decentralized insurance contracts will work in accordance with UMA’s oracle solution that will offer derivative financial products for hedging the risks associated with SpaceX flights.
Opium, the crypto derivatives protocol, has joined hands with decentralized finance (DeFi) platform UMA to offer decentralized insurance products for SpaceX flights. Opium also made this official announcement on Monday, May 24.
The announcement notes that Opium’s decentralized insurance contracts will work in accordance with UMA’s oracle solution. Thus, the ultimate goal is to bring real-world space data on the blockchain platform. Interestingly, Opium referred to this decentralized insurance for SpaceX flights as a new ‘cosmic’ product.
It's time to reveal what we with @UMAprotocol are up to! 🎉
We'd joined our efforts to launch a new 'cosmic' product – decentralized insurance on #SpaceX. Hope @elonmusk will take it to the moon together with @dogecoin
Read more 👉 https://t.co/MoCmxeuMhU pic.twitter.com/uynxw52pOZ
— Opium (@Opium_Network) May 24, 2021
With this partnership, Opium will leverage UMA’s Optimistic Oracle product to offer financial derivatives for hedging the risks associated with SpaceX flights. These derivatives will work as binary contracts allowing users to purchase the insurance against failed SpaceX launches. Also, these derivatives exist on a decentralized financial infrastructure, Thus, they allow user participation from around the world. Andrey Belyakov, founder of Opium Protocol wrote:
“Thanks to Optimistic Oracles’ solution, DeFi can see an expansion of data range for the permissionless financial ecosystem. How cool is this!? We believe decentralized and centralized finance should converge towards each other.”
Opium and UMA to Ensure Financial Risk Management of SpaceX Flights
The SmallSat Rideshare flights from SpaceX allow several payloads to share the launches into space. Thus, the flight bookers can send smaller, lighter payloads. The first launch for such a system took place earlier this year in Jan 2021. Here, a Falcon 9 rocket transported nearly 143 rockets in space.
Now in case of a failed launch, the owners and stakeholders of this payload might want to hedge the risk. Besides, some enthusiasts also might want to speculate on its success and thereby profit from the outcome. Hart Lambur, Co-founder UMA Protocol said:
“Opium is taking the Optimistic Oracle for its first flight, and they are going straight into space. We’re excited to be a part of this clever implementation and I think it highlights the versatility of both the Opium and UMA protocols.”
SpaceX is already offering insurance at around 5% of the value of the payload. Now, Opium and UMA are further willing to compete with this. Following this news, both the native tokens of Opium and UMA have registered a strong rally. The Opium token has surged 24% while the UMA token has surged 13%.
This is a great development for SpaceX as it comes closer to the world of blockchain and crypto. The Elon Musk company has announced accepting Dogecoin (DOGE) payments for its next flight in Q1 2022.