Nexus Mutual Expands Insurance Solutions with Crypto Broker Native
Nexus Mutual backs a new crypto insurance broker, Native, aiming to address the insurance gap in the crypto sector by offering substantial on-chain coverage.
Nexus Mutual, a decentralized alternative for traditional insurance particularly for digital asset risks, is broadening its distribution capabilities by supporting a crypto insurance broker called Native.
Native recently launched with $2.6 million in seed funding, facilitated by Nexus Mutual, which aims to offer $20 million in on-chain coverage per risk. The investment is underlined by Nexus Mutual's existing capital pool of approximately $200 million, primarily in ETH.
Currently, only about 1% of crypto assets are insured, a stark contrast to the traditional financial world where approximately 7% of GDP is covered.
“Native’s role is to tackle this persistent underinsurance issue,” commented Native co-founder and CEO Ben Davies. “A liquid insurance market is crucial for industry growth, and we are creating a commercial insurance broker on-chain that fills this gap.”
The initiative aims to consolidate insurance capabilities by connecting businesses to Nexus’s capital pools, allowing clients to transact in crypto and receive payments via cryptocurrency when claims arise. Its structure involves Native also running a capital pool on Nexus, enabling it to participate in underwriting as a managing general agent (MGA).
Since its inception in 2019, Nexus Mutual has insured nearly $5 billion of crypto assets and has disbursed $18 million in claims across a variety of risks within decentralized finance (DeFi). Nexux employs a model similar to the Lloyd’s of London, allowing members to deploy assets into syndicates in exchange for NXM tokens, which serve to back specific risks.
“We understand crypto-native risks better than anyone else, and we have ample capacity focused on deploying resources into crypto risks and businesses,” stated Nexus Mutual founder Hugh Karp.
In addition, Nexus Mutual's alternative insurance is rolling out over Coinbase’s layer 2, Base, through a new product known as Base DeFi Pass, established by crypto insurance startup OpenCover. This product covers significant protocols like Uniswap, Compound, and Morpho, providing users with versatile coverage across applications without needing to constantly update their insurance needs.
