Nayms, the Bermudian-based marketplace for crypto-native insurance, has launched on Base, which the company says is a secure, low-cost, Ethereum layer-2 solution.

With this launch, the company said, investors can more easily access yield-generating insurance and reinsurance opportunities that are available within Nayms' marketplace in the form of a tokenised asset class.

"We are excited to be launching on Base, our first Ethereum Layer 2 network. Our deployment was seamless as it is fully EVM (Ethereum virtual machine) compliant and we look forward to leveraging the reduced fees and easy on ramp that Base provides," said Nayms cofounder and CTO, Ted Georgas.

Nayms said the first product to go live on Base will be an industry loss warranty contract, reinsuring against certain weather-related catastrophic events in Florida.

It said Nayms' ILW introduces a novel approach, safeguarding buyers against the peril of named wind storms in Florida.

To trigger indemnification, two independent named wind storms in Florida must each separately cause damage exceeding $10 billion to the state's insured property during the 2024 in-force period.

The company said Nayms' innovation lies in the use of USD Coin as collateral within the segregated account on its independently audited Ethereum smart contract.

It added that this collateral is further secured through innovative mechanisms, including a digital multi-signature process, enhancing transparency and operational efficiency.

Within a Bermudian-regulated segregated account structure, the company said, institutional investors can earn yield on their capital, targeting mid-high teen returns, paid by premiums by real insureds and reinsureds who need their risk covered.

For early investors, the yield is complemented by an additional reward of Naym issued tokens equivalent to up to 15 per cent of invested capital.

A Nayms spokesman said: “As the insurance industry evolves, tokenisation offers a unique opportunity for institutional investors to diversify their investment portfolios and capitalise on the growth of traditional private market asset classes.

“Nayms' opportunities offer investments into insurance and reinsurance for property and casualty risks like cyber, errors and omissions, directors’ and officers’ coverage, crime/specie and various industry loss warranty products.

“This exposure is typically only available to pension funds, private equity funds, and other major institutional investors. Nayms is making this exposure available to all qualified investors through tokenisation, accessible in their wallets.”

The company said some of the benefits of tokenised insurance and reinsurance exposure for qualified investors include diversification of returns from the broader crypto market; access to historically hard to access private markets exposure, now in a tokenised wrapper; access to high yield returns with liquidity and low volatility; safety and security of the decentralised Ethereum network but at a low cost, faster settlement time of the Base L2; fast user on boarding through know your customer automation utilising verified identity standards of Ethereum Attestation Service built into open sourced identity on Ethereum.