OpenCover’s Covered Vaults: Covering Vault Risk with Nexus Mutual

DeFi can be an intimidating place to earn yield, but vaults are changing that. Instead of having to become an expert in all things onchain, people now have a simple, accessible way to earn with their digital assets through curated vaults.  

Vaults abstract away DeFi's complexity, facilitating investors' exposure to a variety of strategies. Morpho vaults alone have grown to over $5 billion in deposits, and we’re still just getting started. 

Although vaults simplify the user experience, a vault strategy itself is a complex group of layered smart contracts, with curator fund management, oracle information, and liquidity dependencies aggregated into a vault's share token. When something goes wrong in a vault or its underlying strategy, depositors rarely have the time or the tooling to exit before losses are realized. 

A new primitive for vault risk transfer 

That’s the gap Covered Vaults are built to close, making covering assets in a vault as simple as possible. 

OpenCover’s Covered Vaults launched in April 2026 after nearly a year of development with Nexus Mutual and more than 15 design and launch partners, including Morpho, Kiln, Symbiotic, and Base. Vaults can access up to $50 million in cover capacity, with eight-figures in TVL already protected. 

The breakthrough is composability

Investors deposit into their vault of choice and stake the vault shares in the relevant OpenCover Covered Vault, automatically activating their protection. Staying covered only requires staying in a Covered Vault. Premiums are streamed from the yield generated, the vault itself renews coverage automatically, and ending cover is as easy as withdrawing from the Covered Vault. 

Vault operators and curators have a new way to offer end-to-end cover without making any changes to their vault or its underlying strategy.

“Covered Vaults resolve the flexibility and composability challenges that have prevented conventional insurance structures from translating to DeFi,” said Jeremiah Smith, Co-founder and CEO of OpenCover. “Partnering with Nexus Mutual has allowed us to deliver a primitive that is as elegant as it is powerful, and one we believe will become foundational to how risk is managed onchain."

Why Nexus Mutual is the cover layer 

With our extensive onchain experience, Nexus Mutual is uniquely suited to underwrite the Covered Vaults primitive. Our team has the ability to structure cover that scales with deposits, price risk based on actual exposure, and pay claims to Covered Vault depositors when they suffer a loss. 

“OpenCover is constantly raising the bar on simplifying DeFi risk management,” said Hugh Karp, Founder of Nexus Mutual. “Covered Vaults not only make it easy for investors to cover their assets, but it also enables any vault to support cover options. This is a major win for everyone in vaults, from investors to builders and curators.”

Vaults made DeFi simple: Covered Vaults makes it scalable 

If you’re deploying capital into vaults and want to know what’s covered, or what it would take to create a Covered Vault for your vault strategy, reach out to us today.

You’re Covered with Nexus Mutual