# kaal:claim:3396542-028

**Claim.** How much capital an underwriter holds is ultimately a matter of personal risk preference, and an underwriter willing to tolerate fluctuations in token holdings need provide only for expected losses.

**Type.** mechanism  **Support.** asserted

**Holds when.**

- underwriter tolerant of fluctuations in token holdings

**Source quote.**

> More importantly, how much capital an underwriter holds is a matter of their personal risk preference. An underwriter who is willing to tolerate fluctuations in their token holdings need only provide for expected losses.

**From.** Craig Calcaterra, Wulf A. Kaal, Vadhindran K. Rao, *Decentralized Underwriting* (2019), VI. Conclusion, page 25

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

**Verify.** sha256 of source PDF `ce2bda03a0b788ea3e7747f02c3c351ef7c808a41150d5cda34767bbe98800c0` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Calcaterra%20et%20al.%20-%202019%20-%20Decentralized%20Underwriting.pdf

**Topics.** risk-and-incentives, economics, defi

**Keywords.** capital-requirements, risk-preference, economic-capital, underwriting

**Canonical form.** This markdown file is the canonical hashed representation of the claim. Its sha256 is the content hash used for attestation.