Cointelegraph is proud to announce that Nayms, a marketplace for on-chain insurance that connects brokers and underwriters with crypto capital providers, has joined the Cointelegraph Accelerator program.
The insurance industry is a lucrative market that stands to benefit greatly from the blockchain revolution. With challenges such as high costs, discerning customers, and fraud, the insurance sector has the potential for significant disruption with the power of blockchain technology.
Reports suggest that blockchain could create a $32.9 billion market for the insurance world by 2031. The transparent and distributed nature of blockchain technology allows for a secure and interoperable repository of insurance-related information. This concept led to the creation of Nayms, a digital insurance marketplace based on blockchain.
Nayms acts as a bridge between capital providers and brokers by leveraging segregated accounts established by third-party Sponsors to offer tailored insurance solutions. Sponsors submit detailed business plans, which, once approved, result in the issuance of participation tokens. These tokens represent a contractual interest in the assets and liabilities of a segregated account and are exclusively sold on Nayms’ matching market, allowing investors to fund the accounts with cryptocurrency. The capital raised supports the underwriting of blockchain-specific risks, and insurance contracts are created using Nayms’ Policy Builder. Nayms also manages claims against these accounts, including through designated third-party administrators, to ensure compliance with underwriting guidelines and policy wordings.
Nayms simplifies the process by securely connecting capital providers to insurance risks through smart contracts, automating transactions while maintaining transparency and compliance.
Tokenization plays a crucial role in democratizing insurance by enabling easy entry and exit for investors, increasing liquidity, and widening participation. Nayms specifically targets blockchain-related risks, such as those associated with cryptocurrency exchanges, custodians, and DeFi smart contracts, which represent billions in uninsured value.
By offering crypto-based policies, Nayms reduces currency risk for blockchain and crypto businesses while providing coverage for traditional risks, such as directors and officers against governance-related liabilities and errors and omissions insurance for professional mistakes.
Nayms operates under the regulatory framework of the Bermuda Monetary Authority (BMA), which was one of the first jurisdictions to establish a regulatory framework for digital assets. Nayms holds Class F and Class IIGB licenses under the Digital Asset Business Act 2018 and the Insurance Act 1978, respectively. As a segregated accounts company, Nayms utilizes this legal structure to create segregated accounts for different risk pools, ensuring precise risk management and operational efficiency.
The platform incorporates the NAYM governance token to align incentives among marketplace participants, enhancing the ecosystem’s functionality through staking and voting on governance matters related to the Nayms Liquidity Facility (NLF). The NLF provides primary capital and liquidity to the secondary market on the Nayms marketplace. This model combines decentralized finance (DeFi) elements with traditional regulatory compliance, creating a secure and innovative insurance marketplace.
Through blockchain tokenization, Nayms is collaborating with over 20 partners and a global team to bring liquidity to insurance as an asset class, allowing over $1 trillion of alternative capital in digital assets to access this risk.
To learn more about Nayms, visit their website.