Coinbase-Backed Insurance Disruptor OpenCover Launches on Layer 2 Blockchain

OpenCover, a decentralized insurance distributor targeting cryptocurrency and Web3 platforms, has officially launched on Base, the Ethereum overlay blockchain developed by Coinbase, a Nasdaq-listed U.S. cryptocurrency exchange. Additionally, OpenCover received additional funding support within the Base ecosystem from Coinbase.

OpenCover collaborates with Nexus Mutual, a decentralized finance (DeFi) coverage provider. Nexus Mutual empowers investors to collectively manage pools of funds, offering insurance-like coverage within the framework of a discretionary mutual organization based in the U.K.

Insurance options within the cryptocurrency industry are limited, with even experts in digital asset underwriting hesitating to venture into the experimental realms of DeFi due to its associated risks. Conversely, there is an abundance of capital eager to be invested by pioneers in DeFi coverage, such as Nexus Mutual.

OpenCover, which secured $4 million in seed funding with prominent investors like NFX and Jump Crypto at the helm, recently received an additional $200,000 injection from Coinbase to enhance its launch on Base, as stated by Jeremiah Smith, the CEO of OpenCover.

The insurance option, which is also being introduced on Optimism, another Ethereum layer 2 blockchain, is collaborating with a roster of prominent DeFi projects. Smith stated that they are working alongside Aave, Uniswap, Curve, Safe, Morpho, Synthetix, Beefy, Angle, 1inch, and Yearn.

“OpenCover is an insurance alternative and cover aggregator that essentially offers protection against protocol failures, such as what happened with Curve a few weeks back,” Smith said in an interview with CoinDesk. “We have $200-plus million in underwriting capital from Nexus that is now directly accessible for the very first time on a layer 2.”