DeFi-based insurance platform Nexus Mutual is extending its services to centralized cryptocurrency exchanges such as Coinbase, Binance, Kraken, and Gemini. Until now Nexus was only focused on decentralized exchanges (DEXs), a popular destination for vulnerability and exploits. With the recent onset of hacking in centralized exchanges, traditional insurance cover might come across as expensive. Hence, Nexus Mutual comes to save the day.
Nexus Mutual Expands Service to Centralized Exchanges
The latest service by Nexus Mutual to cover centralized exchanges includes cover claims from Nexus if centralized exchanges such as Coinbase, Binance, Kraken, and Gemini exchanges are subjected to hacks, or users losing more than 10% of their funds. It is even applicable when the withdrawals are halted for more than 90 days.
Nexus Mutual founder Hugh Karp, previously a trained actuary and the former UK CFO of insurance giant Munich Re, told:
“We are expanding to provide coverage for centralized exchanges, starting with the big ones like Coinbase, Binance, Kraken, Gemini, which is a product we’ve had really strong demand for.”
Nexus emerged sometime after the infamous DAO hack of 2016, draining out a whopping $55 million.
Nexus to Offer Covers Independent of the Exchange
Nexus offers to cover users themselves rather than the conventional way of relying on an insurance policy held by an exchange. Termed as the discretionary cover, the platform employs the UK’s legal framework of a discretionary mutual where members have no contractual obligations to pay claims.
Karp assures of Nexus insurance cover, independent of the exchange:
“You don’t have to rely on the insurance that the exchange may or may not be able to purchase themselves, you can come to Nexus separately and get covered, independently of the exchange.”
Holders of Nexus Mutual’s native NXM tokens can use Ethereum public blockchain to track fund ownership and a governance system to approve or decline payment of claims.