Osborne Clarke advises Element Ventures on its investment in Coincover as part of a $9M Series A fundraising

International legal practice Osborne Clarke has advised Element Ventures, a global venture capital fund, as the lead investor in Coincover's $9.2 million Series A round. Coincover provides industry-leading protection and insurance-backed guarantees for cryptocurrency investors. 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.

Element Ventures led the round with participation from 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.

Founded in May 2018, Coincover is building the world’s safety standard for cryptocurrency. The company’s services ensure that users and businesses never lose access to cryptocurrency funds due to user error, business or infrastructure failure. By combining advanced technology and insurance-backed guarantees, Coincover provides disaster recovery and business continuity options for cryptocurrency businesses and enables consumers to enter this exciting market safely.

As interest in cryptocurrency grows, with more than 100 million global crypto users according to Crypto.com, so does the scale of potential problems. Cryptocurrency is typically held in digital wallets, protected by private keys, or in offline, cold wallets which could be a paper wallet, USB or hard drive. If a wallet is lost, or an investor forgets their private key, access to the digital coins can be lost forever. It’s estimated that around 20% of all bitcoin are lost or stranded in wallets that can’t be accessed - currently equivalent to $806bn. Just like regular bank accounts, 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 $3.78bn.

Coincover was built to protect and prevent these issues, ensuring more people can invest in cryptocurrency with greater security and reassurance that they do not lose their investments if they lose a password or private key. The Secure Key Storage means Coincover creates offline emergency backup keys for wallets, stored offline, fully encrypted, and with zero network exposure to prevent targeting by hackers. The Deposit Protection Guarantee protects customer wallets up to the value of $1 million in case of business failure or a catastrophic systems failure. And Coincover’s account monitoring and awareness feature keeps an eye out for any threats to an account.

The Osborne Clarke team consisted of Partner Simon Jones, Associate Andrew Massey and Trainee solicitor Liz Foley from the Corporate team. Associate Director Ian McKenzie and Associate Jennifer Tur from the Commercial team, and Senior Associate Lara Flynn from the Employment team also advised.

Osborne Clarke’s market-leading international venture and growth capital practice is widely recognized as a leading European law firm for companies in the FinTech sector. The venture capital team is ranked tier one by The Legal 500 and has experts across London, the Thames Valley and Bristol. It has an outstanding track record advising start-ups, global market leaders, angel investors and institutional VC/growth capital investors on funding rounds, follow-on rounds, venture debt facilities, IPOs, trade sales and buy & build projects.

Osborne Clarke’s FinTech practice advises major financial institutions and investors, and established and emerging FinTech companies. These include lending and intermediary platforms, digital banks, InsurTechs, and firms specialising in payments, consumer finance, alternative finance, software and cryptocurrency. The FinTech team operates across all major European and South East Asian markets along with offices in Silicon Valley and New York. Ranked as a leading FinTech firm by Chambers Global and The Legal 500: “Their knowledge of the payments and FinTech sector is unparalleled. They are very client driven and mould their approach to their clients’ needs.” Osborne Clarke was named Who’s Who Legal FinTech Law Firm of the Year 2019.