What problem does it solve
Standardizing and opening access to derivatives
The traditional way of creating and managing derivative products relies on centralized intermediaries. This introduces counterparty risk, where the users' funds are at risk if the intermediary defaults or becomes insolvent. This also creates a barrier of entry as the creation and management of derivative products is typically reserved for banks and not easily accessible for normal individuals. Another issue is reduced liquidity as these products are issued in isolated systems which means assets are typically not tradeable outside of the issuer's infrastructure.
DIVA Protocol is a smart contract-based operating system that addresses these issues. DIVA Protocol eliminates reliance on intermediaries, improves security by fully collateralizing products and eliminates counterparty risk. Additionally, it expands access to the creation of derivative products to a wider range of users, and improves liquidity by opening up the infrastructure layer for derivatives.