Coinbase-Backed Insurance Alternative OpenCover Debuts on Layer 2 Blockchain Base

OpenCover, a distributor of decentralized insurance aimed at cryptocurrency and Web3 platforms, has gone live on Base, the Ethereum overlay blockchain built by Nasdaq-listed U.S. crypto exchange Coinbase (COIN). The mutual insurance provider also received a Base ecosystem funding bump from Coinbase.

OpenCover is working with decentralized finance (DeFi) cover provider Nexus Mutual, which allows investors to collectively govern pools of capital to provide insurance-like cover under the auspices of a U.K.-based discretionary mutual.

Insurance within the crypto industry is sparse, and experimental areas like DeFi present a set of risks that even digital asset underwriting specialists tend to shy away from. On the other hand, there exists an excess of capital looking to be deployed by DeFi cover pioneers like Nexus Mutual.

OpenCover, which raised $4 million in a seed round led by the likes of NFX and Jump Crypto, received a $200,000 funding bump from Coinbase to bolster its debut on Base, according to OpenCover CEO Jeremiah Smith.

The insurance alternative, which is also rolling out on Optimism, another Ethereum layer 2 blockchain, is working with Aave, Uniswap, Curve, Safe, Morpho, Synthetix, Beefy, Angle, 1inch and Yearn, Smith said.

“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.”