DeFi insurance protocol InsurAce has raised $1 million in a seed funding round. The investment round was led by Arthur Cheong of DeFiance Capital, a crypto fund reserved primarily for DeFi. DeFiance Capital alone contributed $500,000 of the seed investment. Participation from other investors includes ParaFi Capital, Huobi DeFiLabs, Hashed, Signum Capital, and Lunex Ventures.
DeFi Insurance Protocol InsurAce Raises $1 Million Funding
The DeFi insurance protocol is expected to go live in the coming month. The protocol is also launching liquidity mining to boost its capital pool.
Oliver Xie, founder and CEO of the protocol, said in the release.
“We aim to build a decentralized insurance platform, providing carefree insurance services, and creating sustainable investment returns for our users.”
The rampant increase of DeFi hacks targeted at smart contracts have resulted in heavy loss of funds. Keeping in mind, the founder of the DeFi insurance protocol intends to offer a low premium insurance product primarily for the DeFi space.
Santiago Roel Santos, Partner at ParaFi Capital, said:
“Insurance is a critical component for the growth of any industry. For DeFi to reach mainstream adoption, we need a robust insurance market with multiple providers. As active users of DeFi protocols, we’re keen on supporting InsurAce to develop user-centric solutions that will allow users to capture the benefits of DeFi while minimizing the risks.”
Easy Insurance in DeFi
Current DeFi insurance protocols include Nexus Mutual, where investors need to buy coverage each time they farm a new protocol. In counterpart to this, InsurAce takes up all the protocols under one portfolio. This way, users need to buy only once while getting everything insured.
Meanwhile, the DeFi protocol’s insurance token INSUR will serve as an insurance token. Even though it is not clear how much the INSUR token is decentralized, all the claims and investment decisions will be facilitated by the governance token.