OnRe Review: Bridging Traditional Reinsurance and DeFi

This OnRe Review article explores how OnRe, the world’s first on-chain reinsurance platform, connects traditional insurance markets with decentralized finance (DeFi). It explains how OnRe’s model works, what makes its yield uncorrelated, and why it could change how investors access real-world returns through blockchain. The review highlights OnRe’s innovation, potential benefits, and the main challenges it faces as it bridges DeFi and reinsurance.

What is OnRe Finance?

OnRe is the world’s first on-chain reinsurance company, fully licensed to accept digital assets as collateral for writing reinsurance. It merges blockchain technology with a compliant investment framework, allowing investors to access one of the world’s most resilient asset classes — reinsurance — through a transparent, liquid, and crypto-compatible system. By bringing reinsurance risk on-chain, OnRe opens the door for digital investors to earn consistent, uncorrelated returns traditionally limited to institutional markets.

OnRe Review: How to get started?

OnRe makes it simple for both capital providers and insurers to participate in the reinsurance market through blockchain. The process is designed to be transparent, compliant, and accessible.

1. Get Started
Visit the OnRe website to explore the platform’s structure and benefits. When ready, access the application via the “Get Started” button or directly through app.onre.finance.

2. Connect Your Wallet
Choose a Solana-compatible wallet — such as Phantom, Solflare, SquadsX, Exodus, Glow, or Coin98 — and connect it to the OnRe app. This enables secure, on-chain transactions.

3. Complete KYC
Before your first purchase, complete a one-time Know Your Customer (KYC) verification. You can register as an individual or a company. Once verified, your wallet address is added to OnRe’s whitelist, giving you full access to the investment portal.

4. Purchase ONyc Tokens
Fund your wallet with USDC or sUSDe and choose your deposit amount (not exceeding your wallet balance). The platform automatically converts your deposit into ONyc tokens — fractional, liquid tokens representing your share in the reinsurance pool. By agreeing to the Participation and Disclosure terms, you activate your investment, gaining exposure to stable, uncorrelated returns across market cycles.

5. Redemption Process
Eligible KYC-verified investors can redeem ONyc on a quarterly basis. Each redemption cycle includes a 30-day notice window, and redemptions are fulfilled at the end of the quarter based on the last published NAV. If total redemption requests exceed available liquidity, distributions are handled pro-rata, with any remainder automatically reconverted into ONyc for future redemption rounds.

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OnRe Review: Understanding Reinsurance

What Is Reinsurance?

Reinsurance is insurance for insurance companies. It allows insurers to transfer part of their risk exposure to other entities, known as reinsurers, in exchange for a share of the premium. This process protects insurers from large or unexpected losses, stabilizes financial performance, and increases their ability to underwrite more and larger policies.

In a typical reinsurance agreement, the original insurer (called the cedent) passes on a portion of its portfolio to a reinsurer. By doing so, the insurer strengthens its balance sheet, manages capital more effectively, and gains the capacity to offer broader coverage to clients.

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Why Reinsurance Matters

Reinsurance plays a vital role in the global insurance ecosystem by:

• Increasing insurers’ capacity to assume greater or more diverse risks.
• Enhancing financial stability and solvency across the sector.
• Providing protection against catastrophic events and large-scale losses.
• Allowing more efficient capital management and risk distribution.
• Supporting innovation by enabling the underwriting of new and emerging risks.

Modernizing Reinsurance with Blockchain and Tokenization

While the fundamentals of reinsurance have remained largely unchanged for centuries, the industry is now entering a transformative phase. Advances in blockchain technology and tokenization are making it possible to bring insurance risk on-chain, enabling a new class of investors to participate in this historically closed market.

Through tokenized structures—such as Insurance-Linked Securities (ILS) and on-chain reinsurance platforms like OnRe—capital from digital investors can be directly allocated to reinsurance risk pools. This innovation offers:

• Greater transparency through immutable blockchain records.
• Operational efficiency via smart contracts that automate key processes.
• Improved liquidity, allowing fractional ownership and secondary trading of reinsurance-linked assets.

By transforming insurance and reinsurance risk into real-world assets (RWAs), the market gains access to new capital sources, enhanced efficiency, and broader participation—benefiting both insurers and investors.

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OnRe Review: The Onchain Yield Coin (ONyc)

ONyc is OnRe’s native on-chain yield coin, designed to channel digital assets—specifically stablecoin collateral—into real-world reinsurance underwriting and complementary yield-generating strategies. Each ONyc token represents a fractional, liquid share of OnRe’s reinsurance pool, giving holders direct exposure to one of the most stable and historically uncorrelated asset classes in global finance.

The token targets a base yield of approximately 16% APY, derived primarily from the performance of reinsurance contracts and supplemented by returns on collateral assets.

How ONyc Works

OnRe allows investors to participate in reinsurance markets through a streamlined, on-chain process. After completing a one-time KYC verification, users connect a Solana-compatible wallet and deposit stablecoins such as USDC or sUSDe. These deposits are automatically converted into ONyc tokens, which represent fractional ownership in OnRe’s reinsurance pool.

The pool generates yield from reinsurance premiums and collateral performance, with returns reflected in the token’s real-time value. Investors can redeem their ONyc on a quarterly basis, providing liquidity and transparency while maintaining exposure to a stable, real-world asset class.

OnRe Review: ONyc Liquidity and Redemption

Liquidity flexibility is fundamental to attracting modern investors. OnRe combines scheduled redemption windows and on-chain secondary liquidity to offer a comprehensive, transparent, and efficient market access experience. Redemption is structured to provide investors with clear, scheduled liquidity pathways via rONyc tokens, alongside real-time secondary market liquidity options.

Redemption Process

To redeem, users must complete KYC verification and meet eligibility requirements, including being a sophisticated investor. Redemptions occur on a quarterly cycle, with a 30-day notice window at the start of each quarter during which ONyc holders can exchange their tokens for redemption tokens.

Redemptions are finalized at the end of the quarter based on the last published NAV and are subject to the pool’s available liquidity, which accounts for existing and expected liabilities.

If redemption requests exceed availability, allocations are fulfilled pro-rata, with remaining requests reconverted into ONyc for future redemption rounds.

Secondary Market Access

For on-chain native DeFi users, ONyc offers 24/7 secondary liquidity via decentralized exchanges:

• ONyc/USDC Pool on Orca
• USDG/ONyc Pool on Raydium

A market-making bot actively arbitrages price differences to maintain the token’s price close to its Net Asset Value (NAV). Additionally, users can borrow against their ONyc holdings to enhance yield opportunities.

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Direct Liquidity

Beyond AMM-based trading, OnRe also schedules direct liquidity events to maximize efficiency and meet investor demand. Fund managers can mint new ONyc tokens or issue rONyc tokens as required by market conditions.

While AMM liquidity provides rapid access and predictable pricing, direct redemptions offer structured exit pathways without AMM fees.

Dual Liquidity Advantage

By integrating scheduled redemptions with on-chain secondary market access, OnRe gives investors multiple, flexible options for entering or exiting positions. This dual liquidity framework enhances market efficiency, transparency, and resilience — addressing the needs of both institutional and DeFi-native participants.

OnRe Review: Participation

For the Capital Providers:

Access the Previously Inaccessible

OnRe is redefining the future of reinsurance by bridging the gap between traditional finance and on-chain capital. For allocators, fund managers, and institutional investors seeking scalable, uncorrelated returns, OnRe offers a gateway to a historically untapped market opportunity.

The platform is unlocking access to the $750 billion global reinsurance market, creating a diversified, real-world yield product designed to perform in any market cycle. By connecting $225 billion in stable assets to this uncorrelated asset class, OnRe provides direct exposure to consistent and diversified returns, with potential yields of up to 36.5%, derived from three key sources:

• Reinsurance Performance: Uncorrelated returns from a diversified reinsurance portfolio, professionally underwritten by actuarial experts.
• Collateral Yield: Passive income generated from Ethena’s sUSDe collateral.
• Token Incentives: Additional upside through the $ONRE protocol token.

Built on Solana’s high-speed infrastructure, OnRe ensures frictionless capital flow, enhanced liquidity, and operational efficiency—empowering a new class of investors to capture real-world returns at scale.

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For the Insurers

Access New Global Capital

OnRe enables insurers and brokers to tap into a new, diversified pool of on-chain capital, expanding capacity and flexibility beyond traditional reinsurance markets. This fresh capital source strengthens underwriting potential and enhances market resilience.

Broaden Your Coverage

Through OnRe, market participants gain access to reinsurance across property catastrophe and specialty lines—including Directors & Officers (D&O), Cyber, and Technology Errors & Omissions (Tech E&O). Each program is structured with a disciplined focus on capital preservation and efficient risk transfer.

Trust in Transparency

OnRe’s blockchain-based infrastructure delivers verifiable, transparent capital flows, ensuring clarity and confidence throughout every transaction. This technology-driven transparency enhances operational efficiency and fosters trust between investors, brokers, and insurers.

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OnRe Review: Points Program

OnRe extends its utility beyond reinsurance by integrating ONyc into the broader DeFi ecosystem, allowing investors to boost rewards and unlock additional yield through active participation in partner protocols. The OnRe Points Program incentivizes meaningful engagement, rewarding users who deploy ONyc across decentralized markets to strengthen liquidity, efficiency, and adoption.

How It Works

The OnRe Points Program tracks how ONyc is actively used within DeFi—shifting incentives from passive token holding to active ecosystem participation. Points accrue daily and scale through multipliers that reflect deeper engagement, promoting sustainable liquidity and capital efficiency across the Solana network.

Multi-Tiered Rewards Structure

• 1x Points — Hold ONyc: Earn one point per ONyc per day simply by holding. This baseline reward offers steady accumulation alongside institutional-grade yield from the underlying reinsurance portfolio.
• 2x Points — Provide Liquidity: Earn double points by adding liquidity to ONyc pairs on Solana DEXs such as Orca and Raydium, supporting healthier market depth while also earning trading fees.
• 3x Points — Supply Collateral: Use ONyc as collateral on lending platforms like Kamino or Loopscale to borrow and redeploy capital. Standard lending earns a 3x multiplier, while leveraged looping strategies may achieve even higher boosts.
• 4x Points — Yield Trading Strategies: Participate in structured yield markets such as Exponent, earning up to 4x points for holding or providing liquidity on Yield Token (YT) positions.

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OnRe Review: Audit and Regulatory Framework

Licensing and Registration

OnRe SAC Ltd. is fully authorized and regulated by the Bermuda Monetary Authority (BMA), operating under a robust, dual-license structure that ensures both financial and technological compliance.

• Class F Licence (Digital Asset Business Act 2018): Authorizes the issuance, sale, and management of digital assets and payment services using digital currencies.
• Class IIGB Licence (Insurance Act 1978): Permits innovative general insurance business using digital assets or cryptocurrency within a regulated framework.

Registered Address: c/o Compass Administration Services Ltd, Crawford House, 50 Cedar Avenue, Hamilton HM11, Bermuda.
Registration Number: 55347.

KYC and AML Compliance

Participation in OnRe’s segregated accounts requires all capital providers to complete Know Your Customer (KYC) or Know Your Business (KYB) checks. Eligible participants must qualify as “Qualified Acquirers” under Bermuda law, including high-net-worth individuals, high-income earners, or institutional investors with assets exceeding $5 million. These stringent requirements align with international anti–money laundering (AML) standards and ensure a secure, compliant investment environment.

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Independent Audits and Security Assurance

OnRe upholds the highest standards of transparency and operational integrity through regular third-party audits. Both the platform’s smart contract infrastructure and reinsurance operations undergo independent reviews to ensure robustness, reliability, and adherence to best practices.

• Technical Security: Smart contracts are audited by leading blockchain security firms to detect vulnerabilities and verify code safety.
• Operational Oversight: The reinsurance framework is independently assessed for compliance, sound risk management, and process transparency.
• Continuous Monitoring: Findings from audits are incorporated into platform updates, ensuring that OnRe’s systems remain secure, resilient, and compliant with evolving standards.

Conclusion

OnRe represents a major step forward in bridging traditional reinsurance and decentralized finance (DeFi). By tokenizing real-world reinsurance exposure and integrating it with blockchain infrastructure, OnRe provides investors access to a historically stable, uncorrelated yield market that was once reserved for institutional players.

Through the ONyc token, investors gain exposure to genuine reinsurance performance, collateral yields, and DeFi participation rewards — all within a regulated, transparent, and secure framework.

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