The problem

Mainstream adoption of crypto and web3 is threatened by a lack of trust, confidence, and safety. With nearly $5 billion lost in hacks, scams, and exploits, the Web3 ecosystem needs resilience now more than ever.

One area seriously lagging is insurance. Millions of people are managing trillions of dollars of assets in an adversarial environment without scalable risk management. Traditional insurance models are ill-equipped to address the unique challenges posed by the rapidly growing digital asset and crypto space, leaving owners exposed to risks without comprehensive coverage.

Decentralised finance can’t scale without the stabilisation effect of insurance. NFTs cannot become a mainstream asset class when end-users are still expected to self-custody and self-insure. 

On the other side, mainstream insurance stands to benefit from decentralised technology. Globally, insurers are short of diversified capacity in an increasingly volatile environment. There is a large-scale underbanked, underinsured problem in developing markets which could be addressable via crypto.

In short—web3 needs insurance, insurance needs web3.

The solution

Plural.fi is building a decentralised insurance ecosystem, aiming to build and scale insurance for web3 users and products, and beyond. 

Their core proposition offers insurance to owners of high-value NFTs and portfolios. Leveraging a decentralised architecture, Plural.fi incorporates tokenized incentives and a DAO (Decentralised Autonomous Organization) to provide innovative insurance solutions. 

Their technology uses smart contracts to build collaborative and inclusive financial services which, as opposed to traditional, formal, legally binding contractual agreements, can execute agreements based on their underlying programming. Not only this, but when these contracts are on a public blockchain or other public distributed ledger, their behaviour is independently verifiable and auditable.

This approach is bringing much needed transparency, security, and participation from the community. 

Read the Plural.fi whitepaper here for more information

Why we’re excited to invest

Olly Betts, Founders Factory fintech sector director, says: “The shift to Decentralised Finance continues to gather momentum but DeFi protocols are the number one target for Cyber Attacks preventing mass market adoption. To fully unlock the potential of Web3 a strong insurance ecosystem is needed to underwrite smart contract-linked risk.

“I’m hugely excited and confident in the Plural.fi’s team to deliver their vision of making web3 safe, resilient, and attractive for investors.”