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Disaster Recovery

Insurance companies are a critical point of failure. If an insurer cannot cover obligations:

  • Asset holders receive Network Debt Tokens (NDT) matching their realized loss.

  • NDTs are redeemable monthly against the Disaster Recovery Fund (DRF) at a 1:1 ratio with $REAL.

  • The DRF is financed by redirecting a portion of inflation rewards from business function validators.

  • No net additional inflation is introduced, avoiding systemic risks similar to Terra’s collapse.

  • NDTs expire two years after issuance to prevent perpetual liabilities.

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