Nami insurance

Spot assets

Holding spot assets (BTC, BNB, ETH, ..) when the market volatility plummets will partly affect the total asset value in the user Wallet. With Nami Insurance, upon successful deposit of insurance contract, the loss of asset value due to volatility will be secured through the fact that users will receive a Q-Claim when the market price hits P-Claim.
Here is a example for this case:
User A buy 1 BTC for $30,000 and worried that the price would fall to $27,000, he chooses to buy an insurance policy with the following details.
Based on the following cases, the user can capture the actual PnL when making a Margin and Non-Margin:
Actual PNL = Q-Claim/Q-Refund - Insurance Margin + PnL Spot Trading

Case 1: User A receives Q-Claim insurance payout

In this example, the NAMI Insurance system instantly pays $5,592 into the user's wallet. Although the price of BTC/USDT has dropped, Nami Insurance has guaranteed the temporary negative part of 1 BTC (in this case, -3,000$) thanks to the Insurance Margin.
Actual PnL: 5,592 - 2,400 + (-3,000) = 192$.
Furthermore, at the professional level of Trading and taking use of Compound Interest, User A selects BTC as the Q-Claim receiver, that is, $5,592/$27,000 = 0.2071111 BTC, with the prediction that the BTC/USDT price will rebound after reaching $27,000. By the time P-Market price reaches $30,000 again, PnL will be computed as follows:
Actual PnL: 0.2071111 * 30,000 - 2,400 + 0 = 3,813$.

Case 2: User gets a Margin Refund

At the end of the contract (23:59 on July 03, 2022), P-Market is in the range of $27,000 to $29,850 , User A receives a Margin Refund with a Q-Refund of $2,400.

Case 3: Insurance liquidated

The liquidation of the contract will take place when:
  1. 1.
    During contract validity, P-Market touches P-Expired.
2. At the end of the contract (23:59 on July 3, 2022), P-Market was in the zone according to the chart.
When either of two cases happen, the user does not get their margin back. However, at this time, the user's assets has also made a profit.
Note: Besides the asset hedging margin, users can take advantage of Nami Insurance during the Uptrend phase of the market to optimize profits.
Case 4: Close the contract before the expiration day
When P-Market ($30,000) reachs the price range conditions set by Nami Insurance algorithm, the user is allowed to cancel the insurance contract and receive the refunding margin.