Cryptocurrencies are here to stay, and it seems these will continue to evolve until they become mainstream. While the global shift is not happening anytime soon, considering the volatility, it’s only a matter of when and not if.
According to Crypto.com, there are around 100 million crypto users globally. In general, cryptocurrencies are held in digital wallets, protected by keys, cold wallets, and so on. If a cold wallet is lost or an investor forgets one’s private key, access to the digital coins can be lost forever.
Two chances left to recover 7002 bitcoins
According to the report from New York Times, Stefan Thomas, a German programmer based in San Francisco, lost his password to his hard drive, which contains 7,002 bitcoin, worth nearly €192M as per today’s value.
Thomas received these bitcoins as payment for making an explanatory video on how cryptocurrency works, a decade ago. He stored them in an IronKey digital wallet on a hard drive and wrote the password on a piece of paper, which he had lost.
So far, he has exhausted eight out of ten attempts to get the correct password. After ten unsuccessful attempts, the drive will encrypt itself forever.
20 per cent of bitcoin are lost or stranded
Similarly, around 20 per cent of all bitcoins are lost or stranded in wallets that can’t be accessed, which is equivalent to $806B (approx €682B). On top of that, crypto wallets can be hacked too. In 2020 alone, there were 122 hacks on decentralised apps, cryptocurrency exchanges, and blockchain wallets, which led to the loss of around $3.78B (approx €3.2B).
As the interest grows, so does the scale of potential problems. And here’s where Cardiff-based Coincover comes into play. The UK startup ensures that users and businesses never lose access to cryptocurrency funds due to user error, business, or infrastructure failure.
Coincover raises $9.2M
Recently, the company has secured $9.2M (approx €7.8M) in Series A funding led by London’s Element Ventures.
Other investors including, DRW Venture Capital, CMT Digital, Avon Ventures, Valor Equity Partners, FinTech Collective, Susquehanna Private Equity Investments, LLLP, Volt Capital, and the founding investors Insurtech Gateway Fund and The Development Bank of Wales, also participated.
The funding will be used to drive awareness of the product offering and grow the team so that Coincover can support more of the crypto market, claims the company.
David Janczewski, Co-founder and CEO at Coincover says: “Crypto can be complex and confusing, and people have valid fears around the safety of their funds. With Coincover, we are providing a fundamental building block for a rapidly maturing market by ensuring that people can be protected against making a mistake that can end up costing them thousands. This investment means we can rapidly scale our growth to market and consumer demands, and in doing so ensure more people can invest in crypto safely.”
Based out of London, Element Ventures is a global venture capital fund investing in B2B financial technology companies. The firm focuses on investments in technologies that help working practices in financial markets.
Cover and recovery services
Founded by David Janczewski in 2018, Coincover Protection provides end-users with safety against the loss or theft of crypto assets, and fraudulent transactions, ensuring assets are both safe and accessible.
Coincover says the technology is developed by specialists who developed their expertise in government, military, and law enforcement environments.
The company’s plug-and-play platform gives access to secure backup and recovery of private keys with Government-standard security protocols and an insurance-backed guarantee in the event of theft, fraud, user error, and business failure.
Security, guarantee and Clients
With Secure Key Storage, the company creates offline emergency backup keys for wallets, stored offline, fully encrypted, and with zero network exposure to prevent targeting by hackers.
The company also offers a Deposit Protection Guarantee that protects customer wallets up to the value of $1M (approx €847K) in case of business failure or a catastrophic systems failure.
The UK company works with various companies, including wallet providers BitGo, Curv, Vesto, civic, and Fireblocks. Coincover’s latest clients include AIMS, Bitso, Coinmerce, FalconX, and more.
Earlier this year, the company partnered with GateHub, the multicurrency wallet provider, to cover up to $100K (approx €84K) of cryptocurrency assets per wallet.