Coincover, a Cardiff-based startup providing insurance protection to crypto investors, has secured $9.2 million in Series A funding.
Announced Thursday morning, the investment was led by London’s Element Ventures with DRW Venture Capital, CMT Digital, Avon Ventures, Valor Equity Partners, FinTech Collective, Susquehanna Private Equity Investments, LLLP and Volt Capital all participating. Founding investors Insurtech Gateway Fund and the Development Bank of Wales also piled in.
Founded in 2018, Coincover aims to ensure investors never lose access to crypto holdings due to theft, fraud, user error or business failure. The firm does this through a platform that combines insurance-backed guarantees with secure backup and recovery of private keys, with a policy underwritten by Lloyd’s of London.
“Crypto can be complex and confusing and people have valid fears around the safety of their funds. With Coincover, we are providing a fundamental building block for a rapidly maturing market by ensuring that people can be protected against making a mistake that can end up costing them thousands,” said David Janczewski, co-founder and CEO at Coincover.
Tales of coins lost
Tales of early crypto adopters who could have become excessively rich were it not for misplaced private keys have become commonplace in the sector.
Citing the New York Times, Coincover pointed out in a press release that 20% of all bitcoin in circulation are currently lost or beyond reach. Crypto hacks are equally prevalent. These are the two issues at which the Welsh firm is taking aim.
Coincover’s “Secure Key Storage” product creates offline emergency backup keys for wallets, while its “Deposit Protection Guarantee” covers user wallets for up to $1 million in crypto should the provider fail or suffer a systems outage. The startup claims to have hundreds of customers including the likes of BitGo, Curv and Fireblocks.
Michael McFadgen, a partner at Element Ventures, said Coincover’s infrastructure can help drive the crypto industry towards “mass adoption.”
“More and more people are investing in cryptocurrencies but the industry needs infrastructure and safeguards to make it more consumer-friendly,” he added.
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