kaal:claim:3396542-024

In the DAO structure, provided an adequate token encumbrance system is in place, each agent is individually responsible for the payouts on the policies that agent underwrote, so the burden of holding adequate capital shifts from the entity to each individual agent.

Source quote, verbatim

each agent is responsible for meeting the payouts on the policies they have underwritten. Consequently, the burden of maintaining adequate capital falls on each individual agent

From

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Decentralized Underwriting (2019), V. MODEL, 4. Capital Requirements, p. 22
https://ssrn.com/abstract=3396542 · source PDF

Cite as

Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, Decentralized Underwriting (2019). SSRN: https://ssrn.com/abstract=3396542

Holds when

a good system ensures adequate tokens are encumbered per policy

Classification

mechanismsupport: arguedrisk-and-incentivesdao

Verify

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