Today Coincover, the platform providing industry-leading protection and insurance-backed guarantees for cryptocurrency investors, announces it has raised around €7.7 million in Series A funding from leading fintech and crypto investors.
London’s Element Ventures led the round with participation from DRW Venture Capital, CMT Digital, Avon Ventures, Valor Equity Partners, FinTech Collective, Susquehanna Private Equity Investments, LLLP, Volt Capital and the founding investors, Insurtech Gateway Fund and Development Bank of Wales.
Founded in May 2018, Coincover is building the world’s safety standard for cryptocurrency. The company’s services ensure that users and businesses never lose access to cryptocurrency funds due to user error, business or infrastructure failure. By combining advanced technology and insurance-backed guarantees, Coincover provides disaster recovery and business continuity options for cryptocurrency businesses and enables consumers to enter this exciting market safely.
Coincover’s plug-and-play platform combines a policy underwritten by Lloyd’s of London with technology created by specialists across government, military and law enforcement. It gives access to secure backup and recovery of private keys with Government-standard security protocols and an insurance-backed guarantee in the event of theft, fraud, user error and business failure. Crypto companies embed Coincover’s platform into their offering, giving their customers peace of mind when they’re investing and trading cryptocurrency.
As interest in cryptocurrency grows, with more than 100 million global crypto users, so does the scale of potential problems. Cryptocurrency is typically held in digital wallets, protected by private keys, or in offline, cold wallets which could be a paper wallet, USB or hard drive. If a cold wallet is lost, or an investor forgets their private key, access to the digital coins can be lost forever. It’s estimated that around 20% of all bitcoin are lost or stranded in wallets that can’t be accessed – currently equivalent to approx. €681.3 billion. Just like regular bank accounts, crypto wallets can be hacked too. In 2020 alone, there were 122 hacks on decentralised apps, cryptocurrency exchanges and blockchain wallets, which led to the loss of around €3.19 billion.
Coincover was built to protect and prevent these issues, ensuring more people can invest in cryptocurrency with greater security and reassurance that they won’t lose their investments if they lose a password or private key. The Secure Key Storage means Coincover creates offline emergency backup keys for wallets, stored offline, fully encrypted, and with zero network exposure to prevent targeting by hackers. The Deposit Protection Guarantee protects customer wallets up to the value of $1 million (around €845K) in case of business failure or a catastrophic systems failure. Additionally, Coincover’s account monitoring and awareness feature keeps an eye out for any threats to an account.
Hundreds of companies already use Coincover’s platform, including wallet providers BitGo, Curv and Fireblocks, with millions of potential end-users protected through its technology. Losing a laptop or smartphone no longer means losing millions of dollars worth of crypto investments.
In the same way consumers buy travel insurance when they book a holiday, Coincover wants to ensure everyone can access cover when they invest in cryptocurrency. By offering its plug-and-play platform to crypto investment apps and platforms, investors can buy and sell over 200 different coins from different platforms and wallets and know that if they’re covered by Coincover then their investment is safe. This helps to reduce the risk associated with investing savings in crypto and means headlines about people with two guesses left to unlock bitcoin worth $240 million (around €202 million) will become a thing of the past.
By reducing the risk associated with cryptocurrencies, Coincover is aiming to democratise access to the industry, give people the choice to invest in this burgeoning industry and ultimately create the safety standard needed to establish cryptocurrency as a global financial standard.
To power this mission, Coincover has now raised around €7.7 million in Series A funding, which it will put to use driving awareness of its product offering and grow the team so that Coincover can support more of the crypto market.
David Janczewski, Co-founder and CEO at Coincover, said: “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. This investment means we can rapidly scale our growth to market and consumer demands, and in doing so ensure more people can invest in crypto safely.”
Michael McFadgen, Partner at Element Ventures, said: “More and more people are investing in cryptocurrencies but the industry needs infrastructure and safeguards to make it more consumer-friendly. People don’t want to be losing their laptops and having millions go missing. Coincover is building the infrastructure that will allow crypto to reach mass adoption, with a fantastic management team that can tackle this problem in a way that no one else can. We’re delighted to be supporting David and the team and can’t wait to be a part of their growth journey.”
Kim Trautmann, Head of DRW Venture Capital, said: “As an early investor in crypto assets, it’s been clear to us that there would be tremendous opportunities for smart, forward-thinking startups to develop products that support the evolution of the ecosystem. Coincover has positioned itself to take the lead in solving one of the most prevalent problems: how to protect wallet access and the funds within them. We’re excited to make this investment and work alongside Coincover’s world-class leadership team to raise additional awareness around these issues.”
Sean Lippel, Head of Digital Assets at FinTech Collective, said: “The private key experience is still too foreign, cumbersome, and risky for mainstream crypto users. As digital assets look to scale adoption from millions to hundreds of millions of users, the check-the-box deposit and theft cover solution offered by Coincover will be a critical component. We are excited to back such a talented technical team out of the UK with a strategic B2B2C marketing strategy that will enable custodians globally.”
Soona Amhaz, General Partner at Volt Capital, said: “One of the biggest challenges in our industry is crypto protection, and Coincover is the team to solve it. Coincover is building critical infrastructure to help get users and institutions more comfortable with this new financial paradigm. We’re delighted to support David and the rest of the Coincover leadership team.”