Nexus Mutual Review in Details
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Are you ready to learn about a fascinating new platform built on the Ethereum network? One that brings decentralized insurance to decentralized finance? Then, Nexus Mutual might be right for you.
Initially launched in 2019, this project gives its users the capability of insuring their smart contract positions using its native token, NXM. How does it function? By drafting risk-sharing pools.
These pools give Nexus Mutual customers the ability to stake their capital in the pool or cover smart contact positions, thereby reaping a steady stream of passive income.
But is this a good idea for you? In this Nexus Mutual review, we’ll take a thorough look at the pros and cons of this platform. That way, you’ll know whether this crypto-insurance is right for you and your current financial needs.
Mutual Insurance and Cryptocurrency Safety
The concept of DeFi insurance comes in response to a recent history of high-profile hacking cases. These cases resulted in coins stolen as well as the loss of clients’ access and private keys.
For those who have already experienced these events, the concept of ensuring coins proves a welcome addition to the cryptocurrency marketplace. But is this mutual insurance option all it’s cracked up to be?
When Nexus Mutual launched, there were no other decent crypto asset insurance options on the market. After all, places like State Farm aren’t in the business of insuring Bitcoin, but that doesn’t mean insurance is not needed.
Anyone who’s suffered through stolen assets will understand this. Problems with cryptocurrency safety got exacerbated by the introduction in 2014 of smart contracts. Today, many of the smart contracts in use hold Ethereum or another asset type.
These smart contracts all remain at risk of losing coins or being hacked. In other words, loopholes exist in the system, and you need to be protected against them.
Just think about the 2016 hack of Ethereum DAO. It resulted in losses of 3.6 million ETH, a heartbreaking situation with no recourse for the owners.
Nexus Mutual Review
What is Nexus Mutual? They represent the first cryptocurrency insurance provider. The company offers ways for users to protect their activities in the DeFi ecosystem.
Although we use the term “insurance” for practical purposes, Nexus Mutual avoids this term. Why? For legal reasons as well as some key differences between the services provided.
Traditional insurance comes with the motivation to generate revenue. If these companies don’t regularly rake in money, they’ll go out of business.
In other words, the drive to create profits outweighs the needs of individual policyholders. But Nexus Mutual operates from another model.
They rely on blockchain technology to alter the for-profit focus. The objective? To shift away from the for-profit model for the betterment of consumers.
Nexus Mutual recognizes the vital role of insurance in the modern world. But they also acknowledge that it could use a serious overhaul.
They believe their product represents that overhaul. The company claims to have made essential improvements useful to users rather than the vast corporations profiting from the current arrangement.
Of course, as a forerunner in this new area, Nexus Mutual still has some improvements to make. And it also has some serious ground to cover before it represents a significant disruptor of the insurance universe.
That said, their future will no doubt prove interesting, groundbreaking, and innovative. Nexus Mutual’s blockchain-based products are making headway despite the uphill climb the company faces within its specific market.
What to Know About Crypto Insurance and Nexus Mutual
Nexus Mutual takes its name from the insurance world. The “mutual” in its name communicates the fact that policyholders own the company.
In Nexus’s case, these individuals are more accurately described as those who hold the native NXM token. These are the owners of the company’s native blockchain.
As a result, they make decisions regarding the governance of the company’s blockchain and the payouts they make. Unlike more traditional insurance companies, Nexus limits its scope to the insurance it offers.
In other words, you can’t use Nexus Mutual’s products to insure yourself or your property against car accidents, natural disasters, death or dismemberment, etc. It’s not unrealistic to assume these problems are on the horizon, though.
Team members of the company have alluded to these possibilities. For the moment, however, you may only use this insurance to secure assets loss during smart contract failures.
As recent history has demonstrated, blockchain assets prove vulnerable to issues. So do smart contracts. Risk factors include everything from malfunctioning code in a wallet to active hacking attacks and small personal errors.
Final Word: Best Cryptocurrency Insurance
When it comes to getting the best cryptocurrency insurance policy for your crypto and digital assets, your best option is Cryptocurrencyinsurance.io. Cryptocurrencyinsurance.io offers protection to your crypto wallets, crypto exchanges and trading platforms.
You can be sure to get the best protection against phishing attacks, smart contract cover to protect against smart contract vulnerabilities, crypto exchange collapse, dao hack, transaction failure due to network congestion etc. Cryptocurrencyinsurance.io is a leader of members of the mutual crypto insurance.
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