The blockchain, Bitcoin's underlying technology, is going to change everything. Ethereum, a decentralized platform that runs smart contracts: applications, is the tool that will make that change possible. We are building Dynamis to prove what smart contracts can do and to develop the next generation of web 3.0 tools.
Smart contracts are powerful means for enforcing rules which hold, transfer, receive, or spend digital assets. What the internet did to liberate information blockchain technology is now doing to facilitate agreements. Insurance requires much more than the facilitation of trustless payments. The real challenge is figuring out how software code can automate the underwriting of policies, the validation of claims, and the verification of the state of places, people and things in the real world.
The insurance DAO has a potential for greater accountability in how an insurance institution is governed. Human institutions governed by corporate charters may be subject to human error or coercion. Insurance DAOs are governed by smart contract code published on the blockchain. When this code is ran all computational steps, their results and their beneficiaries are published on a publicly auditable ledger. This means that the operations which pay or deny claims can be examined to see if any unfair result occurred.
Dynamis is a smart contract for peer to peer insurance running on the Ethereum platform. It provides supplementary unemployment insurance by using the LinkedIn social network as a reputation system. Applicants for a new policy can use LinkedIn to verify their identity and employment status. Claimants can use their LinkedIn connections to validate that they are looking for work. The exercise of one's social capital within one's social network enables participants to obtain a new policy or open a new claim.