Cap Pendle market cover: covered risks and exclusions
Looking to protect yourself against protocol failures? Here is what your multi-protocol cover includes and doesn't — in plain English.
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This is a summary of covered losses and exclusions for Multi-protocol Cover provided by Nexus Mutual through OpenCover. Ensure you read and understand the full cover wording here (Part B) and Annex before purchase.
How multi-protocol cover works
Multi-protocol cover protects your funds across the Cap and Pendle protocols.
The Cap Pendle market cover pays out in case of a covered incident on Cap or Pendle. In contrast, the (single-protocol) Cap cover only pays out in case of a covered incident directly on the Cap protocol.
What is covered
A loss of funds that results from any of the below are covered:
- Protocol smart contract code bug or error
Previous payout examples: Euler Finance $3.3m paid out March 2023 (flashloan donate function logic exploit), Rari Capital Fuse $5.0m paid out May 2022 (re-entrancy attack). - Economic event outside intended protocol operation caused by either:
a. Oracle manipulation or failure
b. Liquidation failure
c. Governance takeovers where a malicious upgrade is forced through
Previous payout examples: Beefy $98k paid out December 2025 (Stream xUSD related liquidation failure), Perpetual Protocol $337k paid out June 2022 (economic design failure).
What is not covered
Financial losses that result from any of the below are not covered:
- Phishing, private key security breaches, malware, miner behaviour or any other activity where the protocol continues to act as intended.
- Events that occurred before the cover period began, or were publicly disclosed as bugs or warnings for the covered protocol (or its parent protocol in the case of the covered protocol being a fork) before the cover period began.
- Market price movements of assets used or relied upon by the covered protocol, except when the price movement qualifies as oracle manipulation.
- Depegs of any asset that the covered protocol generates (depeg exclusion).
- Protocol owners or controllers confiscating or stealing funds in line with the permissions of the protocol irrespective of the individual or entity that has access to the owner or controller accounts ("rug pull" exclusion).
- User interface or website errors where the protocol continues to act as intended.
- Failures in components used to bridge assets between different blockchains.
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