Evertas, the cryptocurrency insurance firm that received a nod from Lloyd’s of London earlier this year, has raised $14 million in funding, underlining the need for assurances within the turbulent, unpredictable digital asset space.
The $14 million Series A round, which was led by Polychain Capital, adds to a $5.8 million seed funding secured last year, bringing the company’s total outside investment to $19.8 million.
Insurance of cryptocurrency wallets against hacks, thefts and natural disasters hasn’t convinced all the major exchanges to be worth the squeeze, thanks to things like high premium, combined with unclear policy definitions. But in these uncertain times, having insurance over assets guarantees a third-party professional underwriting firm has scrutinized a firm’s systems and controls, said Evertas CEO J. Gdanski.
Moreover, Gdanski pointed out that Evertas has been in communication with the U.S. Securities and Exchange Commission (SEC) about how insurance can be an effective proxy for regulation when it comes to a rapidly evolving technology such as custodial crypto – a need that will be ever more pressing in the wake of the recent FTX collapse, he said.
“There are things that come out of these massive crises in the space that we’ve had in our underwriting for three or four years,” Gdanski said in an interview with CoinDesk. “That includes things like trust accounts, segregation of assets, clear delineation of ownership in the event of bankruptcy or insolvency, having appropriate boards in place.”
Also included in the Series A round were: SinoGlobal Capital, CMT Digital Ventures, Foundation Capital, Morgan Creek, Bloccelerate, network0, Matrixport, and HashKey. Individual investors include Balaji Srinivasan, Andrew Keys, Colleen Sullivan, Patrick McDonald and David Roebuck.
Outside of Evertas, the crypto insurance space has almost no true and dedicated expertise, according to investor Andrew Keys, co-founder of advisory firm Darma Capital.
“The incumbent carriers and reinsurers writing the occasional crypto policy are staffed by insurance generalists analyzing these very specialized risks, part time; they’re in way over their heads and that’s unsustainable,” said Keys in a statement.
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