In a Monday announcement, crypto.com secured a mind-blowing insurance offer of 150 million dollars which was achieved through a pooled arrangement with three insurance companies.
With two million users, cypto.com has also added to its stack of insurance covers after landing another $100 million direct policy insurance and an additional 110 million dollars cryptocurrency insurance from BitGO.
Getting insurance for digital assets has been a challenging activity in the past, even for the big exchanges. However, the situation is taking a bright turn for exchanges since one of the renowned insurance specialists, Lloyd's started offering insurance to cryptocurrency exchanges.
Recent rivalry for crypto insurance among crypto exchanges paints a picture of development for the industry. With Bittrex sealing a whopping $300 million insurance cover for cold storage and Coinbase's recent $200 million insurance deal, it's evident that insurance firms are now interested in the crypto market.
The CEO of crypto.com, Kris Marszalek, acknowledged that securing the massive insurance was a challenging process, and it took the company 18 months to achieve. He further added that it was an expensive endeavour with little leverage to negotiate.
Crypto.com secured the insurance cover through a Ledger Vault and a partnership with Marsh, an insurance broker and Lloyd's backer Arch Insurance.
Kris hopes that when the industry gets bigger and more competitive, the process will become more accessible and less expensive.
Cold storage insurance only covers loss of private keys caused by natural disasters and insider theft but does not cover loss due to 3rd party hacks. Major exchanges like Binance believe cryptocurrency insurance is lacking since crypto firms can always self-insure anyways in case of an unforeseen disaster.
Source: Coindesk
