Cozy Finance

Cozy Finance is a decentralized finance (DeFi) safety and risk management protocol that provides comprehensive protection infrastructure for crypto protocols and their users. Founded in 2020 by Tony Sheng and Payom Dousti, the company operates as a modular, composable safety stack that helps DeFi protocols unlock capital from safety-seeking investors. Cozy offers three core protection primitives: Tranche (splits yield into junior/senior tranches where the junior absorbs losses first), Reserve (establishes a backstop of assets that covers protocol shortfalls), and Protection Markets (opt-in, market-based contracts that cover security exploits, hacks, and market risks). The platform is designed to be transparent, predictable, and institutionally audited — providing alternatives to opaque insurance providers. Cozy's modules automate risk recovery so protocols do not need to rely on post-mortem community funds. The protocol has undergone multiple formal security audits and is designed for composability, allowing any DeFi protocol to integrate Cozy's protections and define their own safety parameters.