Mirroring the real world, certain kinds of decentralised insurance have emerged to combat these kinds of risks. Two common ways of doing insurance in DeFi are through risk pools and credit default swaps. Risk pools are like liquidity pools, where insurance can be purchased like one might purchase travel insurance—a bet or a deposit can be insured over a specified amount of time for a premium. In a credit default swap, an underwriter agrees to assume the risk of some contract or financial derivative in exchange for a premium. Even when done peer-to-peer, these can be cumbersome if one wants their investments to be meaningfully insured.