New insurtech enters market with Munich Re and Sompo’s backing

A new insurtech aiming to bridge the worlds of traditional insurance and decentralised finance (DeFi) has entered the market with the backing of re/insurance giants  Munich Re and  Sompo Holdings.

Chainproof, which claims to be the world’s first regulated smart contract insurance provider, has launched in Bermuda. It will offer licensed, institutional-grade insurance coverage for open-source, non-custodial smart contracts on public, decentralised blockchains.

Chainproof was incubated by Quantstamp, a blockchain security auditor managing more than $200 billion in digital asset risk. With seed investment and foundational support from  Sompo Light Vortex, 100% owned by its parent  Sompo Holdings, and reinsurance backing from  Munich Re.

The rapidly growing world of DeFi has over $70 billion of total value locked, a 6,000% increase from two years ago. This growth comes with significant risk yet traditional insurers lack the historical data and technical expertise required to properly underwrite insurance related to smart contracts.

This lack of regulated insurance has kept DeFi from achieving mainstream adoption, Chainproof claims. The combination of knowledge of Quantstamp,  Sompo and  Munich Re, mean Chainproof claims it is positioned to become a leading regulated smart contract insurance provider.

“ Sompo is proud to be a foundational partner to Chainproof, a pioneering insurance provider for the growing DeFi economy,” said Koichi Narasaki, CEO of  Sompo Light Vortex and executive officer of Sompo Holdings. “Chainproof represents the leading-edge of regulated insurance solutions for the groundbreaking world of Web3.”

Andre Knoerchen, head of new tech underwriting, from  Munich Re, added: “Quantstamp and Chainproof provide the specific risk assessment expertise which is needed to navigate the emerging DeFi insurance market. Institutional investors will be further enabled to succeed in the DeFi sector, if they are covered by regulated insurance, which we support through reinsurance.”

Sebastian Banescu, CEO of Chainproof, said: “We are honoured to have been trusted by such distinguished partners in the traditional insurance industry as SOMPO and  Munich Re. Given the fact that there is no such thing as a 100% secure smart contract system, we see the product offered by Chainproof as a must-have for institutional investors who want to navigate the DeFi space safely.”

Chainproof is backed by a number of other entities including Compound, Aave, Lido, Synthetix, Kyber, Amber Group, MakerDAO, Badger, DeFi Alliance, The Graph, Coinlist, Zynga, Illuvium, Hashgraph, Rally, Celo, Polygon, Blockfolio, Dapper Labs, and more.

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