Crypto Services Giant BitGo Launches $100-million Digital Asset Insurance

BitGo cryptocurrency digital asset insurance QuadrigaCX

Cryptocurrency security company BitGo has launched a new insurance offering for its customers, providing up to $100 million in coverage for loss and theft of cryptocurrency.

The most significant insurance product of its kind to tackle risks inherent in cryptocurrency storage, the provision will be underwritten by the Lloyd’s insurance and reinsurance market, providing coverage in the event of hacks or the loss of private keys.

The news comes just weeks after it emerged that the QuadrigaCX exchange was unable to retrieve funds stored in its cold wallets, after the firm’s founder and CEO unexpectedly died, resulting in significant financial difficulties for the exchange and its customers.

The insurance protection applies to funds stored as part of BitGo’s crypto custodian services, and will protect against both external and internal thefts, including threats from both hackers and employees around the theft or loss of crypto assets.

The policy follows a period of rigorous assessment of BitGo processes by underwriters AmTrust, which already insures the likes of fine art and vaulted bullion.

BitGo will also extend Lost Key Cover to customers using its Business Wallet service, available at an additional charge through the platform.

BitGo CEO Mike Belshe described the protection as “the most complete” insurance product in the cryptocurrency sector.

“It is not always easy for some clients to understand under what circumstances their investments are insured and to what extent their loss would be covered. We are changing that by being more transparent than any other company about the terms of our coverage. Transparency and accuracy is essential for building trust in the market.”

Nicholas Edwards of AmTrust said the product was the result of intensive efforts to develop insurance coverage for the emerging cryptocurrency sector.

“We have been working hard to tailor a bespoke insurance product for BitGo, in this new, rapidly developing and complex sector.”

The development will appeal to business users of BitGo services, and in particular to institutional investors exploring digital asset investments.

By protecting against the risks of theft and loss, which currently present barriers for financial institutions accessing crypto markets, the product will make BitGo a more appealing choice for banks and investment firms, as well as other large-volume cryptocurrency investors.