Insurance Tiers
CAIP: Circle Admin Insurance Pool
First-line coverage funded by a percentage of Circle volume plus slashed stakes
Tier Details
CAIP (Circle Admin Insurance Pool)
First-line coverage for disputes and merchant failures. Funding Sources:- Percentage of Circle transaction volume (17.78% of protocol revenue)
- Slashed stakes from misbehaving Circle Admins
- Cover routine disputes
- Compensate users for merchant failures
- First pool accessed for claims
CALR (Circle Admin Locked Rewards)
Second-tier buffer from admin earnings. Structure:- Portion of Circle Admin rewards automatically locked
- Rolling buffer that builds over time
- Released only if needed for claims
- Additional layer of admin accountability
- Skin-in-the-game for Circle operators
- Intermediate coverage before protocol pool
PIP (Protocol Insurance Pool)
Systemic backstop for large-scale failures. Characteristics:- Protocol-wide insurance fund
- Used when lower tiers are depleted
- Covers systemic failures
- Last line of defense
Implementation Status
Current insurance mechanisms are operational but will be expanded with:- Programmable slash/reward logic
- Automated dispute-linked payouts
- Enhanced multi-tier escalation
- On-chain insurance pool management
Design Philosophy
Layered Protection
Multiple tiers ensure comprehensive coverage
Aligned Incentives
Circle Admins have capital at risk in insurance pools
No External Costs
Disputes funded by protocol, not externalized to users
Systemic Safety
Protocol pool protects against catastrophic failures