Digital asset security company BitGo now allows its customers to increase their insurance limit for crypto that’s stored in special vaults to $100 million and beyond.
Back in February 2019, the company introduced the cold storage insurance backed by Lloyd’s, the same insurance that just had its coverage limits lifted. It seems the demand was high for such a change, said Rodrigo Vicuna, the CFO at BitGo.
The Market’s Insurance Capacity Has Increased
2 years ago, big exchanges and crypto custodians were struggling to offer insurance against digital assets being lost, but this changed ever since Lloyd’s of London’s syndicates started to risk more and increase the insurance market capacity. The BitGo’s Lloyd’s-covered insurance is against damage or theft from vaults holding cash, fine art, gold and many other assets. When it comes to crypto, the cover is $100 million or more for digital assets that were kept on devices never to be connected to the internet. This means it covers against theft of cryptographic keys and of the physical access to any storage.
Crypto.com to Be the First Customer of the Policy
BitGo said that Crypto.com, the exchange based in Hong Kong and ran by its CEO and co-founder Kris Marszalek, is going to be the new policy’s first customer. Here’s part of Marszalek’s statement about this:
“BitGo carries a robust insurance program, elevating the scope of protection for our digital assets in their custody and providing further assurance to our customers that their funds are safe and protected.”
The excess policy will be arranged by Woodruff-Sawyer & Co and London’s Paragon Brokers.
Hot Wallet Coverage Can Be Added Too
Not only BitGo expanded its cover for cold storage, but it also offers coverage for hot wallets, as a result of a partnership with Coincover, which has made the announcement that is Lloyd’s-backed. The crime policy at Coincover covers third-party hacks, which are very common means of stealing crypto.
BitGo and Coincover are working together ever since Coincover’s name was Digital Asset Insurance (DAI). David Janczewski, the CEO of Coincover, had this to say about the partnership with BitGo:
“Anybody with a BitGo wallet could get hot-wallet coverage with us.”
He added that Lloyd’s offering on the policy is for each case taken separately, whereas the limits for the hot wallet cover are in millions and possible tens of millions.