Operating on the Ethereum platform, Cover Protocol provides peer to peer coverage with fungible tokens which the market sets coverage prices as opposed to a bonding curve. For each DAI deposited, the user receives 2 tokens, a CLAIM token and a NOCLAIM token.

The NOCLAIM token represents rights to receive the deposited collateral in the event that a claim payout is not awarded during the designated coverage period.

The CLAIM token represents a right to receive the deposited collateral (or a fraction thereof) in the event that a claim payout is awarded by the claims management process.