The decentralized finance (DeFi) synthetic derivatives Opium Finance protocol has entered into a partnership with Universal Market Access contracts platform UMA. The aim is to launch decentralized SpaceX insurance using UMA’s Optimistic Oracle.

In an announcement on May 24, Opium stated that its decentralized insurance contract (CDS) will work in tandem with UMA’s oracle solution to bring real-world data to the blockchain.

There was a surreptitious Dogecoin plug in the tweet that also tagged SpaceX founder Elon Musk.

“We’d joined our efforts to launch a new ‘cosmic’ product – decentralized insurance on SpaceX. Hope @elonmusk will take it to the moon together with Dogecoin.”

The derivatives work as binary options contracts, allowing users to purchase insurance against a failed launch on SpaceX. Using the SmallSat Rideshare program, organizations can send lighter and smaller payloads to space for as low as $1 million.

The announcement elaborated:

“The financial instrument can be used to hedge financial risks related to the SpaceX launch and even to generate some income.”

The derivative seller essentially offers insurance coverage for a failed launch by locking an amount of money as collateral and earning a premium in the process. These DeFi derivatives allow for risk management and speculation in a globally accessible and non-custodial manner, it added.

SpaceX already offers insurance at around 5% of the value of the payload, and Opium and UMA are attempting to compete with that.

To ensure high-speed, low-cost transactions, the offering will utilize UMA’s Optimistic oracles.

Just like Optimistic rollups, the Optimistic oracle operates on the assumption that one party sends a request and another party pushes the answer on-chain. Disputes can be raised if either party thinks there is something wrong, otherwise the transaction is completed quickly and with minimal network fees.

Opium, which offers a range of leveraged derivatives, launched TurboETH trading in late April to offer higher risk exposure to Ethereum markets.

Opium’s native token of the same name has surged 24% over the past 24 hours at the time of press, reaching a price of $3.68. The token is still way down from its $23 all-time high on Feb. 4, however.

UMA has also gained well today with a 13% increase to reach $13.46. It too is a long way down from a $45 ATH in early February.

The post Opium and UMA Unveil DeFi Insurance for SpaceX Launches appeared first on BeInCrypto.

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