What Re Is

Karn opened with the clearest version of the pitch: Re is an onchain reinsurer. Stablecoins come in, are transferred to partner reinsurers to serve as collateral to back reinsurance contracts, those reinsurers collect premiums, and the economics flow back to the onchain capital layer.

At the time of recording, Re Protocol's capital was backing contracts with over 30 insurance carriers through partner reinsurer Cover Re. These contracts amount to roughly half a billion in progress, with the protocol targeting one billion over the following seven months.

The reinsurance market itself is enormous and largely invisible. About a trillion dollars in reinsurance premium is processed annually across industry giants like Munich Re, Swiss Re, and Lloyd's of London.

"Being onchain and utilizing onchain capital is probably the most elegant use case of onchain capital. We take in capital that anyone in the world can see at any given point in time. Regulators, insurance company customers, anyone with a computer can see that we are good for the promise and that we're solvent at any given moment."

Karn Saroya, CEO of Re

Why Blockchain Is the Right Infrastructure

Avichal framed it from an investor's perspective: from the outside, Re looks like a standard reinsurance business. But two things make it structurally different.

The Market Opportunity

The reinsurance market is roughly $700B in annual premium globally. Below it sits a larger insurance market of seven to eight trillion. Karn noted that the combined ecosystem represents roughly 12% of global GDP, a figure Avichal suggested could be read even higher if one counts governments as the ultimate backstop for large-scale risk.

Re's current portfolio focuses on low-volatility, catastrophe-lite lines: auto, home, workers' comp, commercial property. High-volatility, binary-outcome risks like earthquakes or hurricanes come later, once the infrastructure and underwriting relationships are in place.

"You want to build the muscles. You want to attract the underwriters around the world that have the specialty in a particular domain, so that they can tap this and deliver economics rather than trying to build that muscle entirely yourself."

Karn Saroya

Lloyd's of London as the North Star

One of the most interesting threads in the conversation was the comparison between Re and Lloyd's of London. Lloyd's is a 330-year-old insurance marketplace that evolved from London coffee houses into one of the largest insurance markets in the world, with roughly 103 distinct underwriters globally, governed through a council that decides counterparty requirements, capital standards, and acceptable lines of business.

"The Lloyd's market, much like the Re protocol, dictates who the acceptable counterparties are, lines of business, capital requirements, and has a governance council that oversees all of this, and behind it a very large pool of capital that secures the network. A ton of our own inspiration comes from Lloyd's. That is the North Star for us."

Karn Saroya

Avichal took it further. When he first understood Lloyd's structure, his reaction was that it looked like a DeFi protocol: a large pool of capital, a governance council, underwriters pitching to the pool, segmented risk.

The long-term vision for Re is an internet-native capital market for all of insurance, not just reinsurance. Bermuda and Cayman reinsurers are already approaching Re with interest in tapping into the onchain capital pool. Re's vision is an onchain Lloyd's of London: a common capital pool that can feed any insurer and any reinsurer in the world.

The Capital Structure

Karn walked through how the money flows. There are three layers:

What the $RE Token Does

The $RE token is a governance token for the Re ecosystem, modeled explicitly on Lloyd's governance structure. It dictates who the acceptable counterparties are, what lines of business are permitted, what capital is required, and governs the size and release schedule of the common pool.

"It has the potential to be an enormous sum of money that protects tens of millions of people around the world. Every asset manager and every reinsurer and insurance company in the world should be interested in this."

Karn Saroya

Controlling the parameters of what could become the largest insurance capital pool in the world is a different kind of governance than simply voting on protocol parameters with no underlying economics.

What Karn Is Focused On

With the $RE TGE complete, the focus now is scaling the business ahead of the January 1, 2027 insurance market renewal cycle, the moment when the largest contracts in the industry are renegotiated.

"We're no longer a toy. We're no longer conceptually interesting. It is a real market player with real market access and capital to boot."

Karn Saroya