Major American cryptocurrency exchange Coinbase has revealed details of its insurance coverage for its hot wallet crypto holdings, reportedly covering a $255 million limit via a Lloyd's of London-registered broker.
The details were disclosed in an official blog post from Coinbase's Chief Information Security Officer Philip Martin on April 2.According to Martin, Coinbase has held an insurance policy covering its hot wallet crypto holdings since mid-November 2013, in particular to protect against what the exchange identifies as being the highest-risk consumer loss scenario in the crypto space - theft by hacking.
"[A] hot wallet policy with a $255 million limit placed by Lloyd's registered broker Aon and sourced from a global group of US and UK insurance companies, including certain Lloyd's of London syndicates.
Lloyd's of London, as Martin notes, is itself not an insurance company but rather functions as its own partially-mutualized insurance marketplace, within which multiple underwriters, grouped in syndicates, come together to pool and spread risk.
The two chief insurance classes involved in crypto insurance, Martin outlines, are the Crime and Specie marketplaces.
The former focuses on losses potentially caused by hacking, insider theft, fraudulent crypto and fiat transfers, and so forth.
The latter - Specie - focuses on physical damage or the loss of private keys.
Martin further clarifies that Coinbase determined its coverage by aiming to have sufficient Crime coverage to fully cover its hot wallet holdings, and that it does not promise preferential insurance payouts to specific customers.
As previously reported, an undisclosed insurer has previously insured a crypto custody platform from U.S.-based custodial firm Kingdom Trust through the Llyod's of London marketplace.
Big-name insurers such as AIG, Allianz, Chubb, and XL Group are also reported to have been tailoring their coverage options for crypto businesses, charging reportedly higher premiums to account for the ostensibly higher risks as compared with the traditional corporate sector.
Coinbase Reveals Hot Wallet Coverage Up to $225 Mln Via Lloyd's of London Broker
pubblicato su Apr 2, 2019
by Cointele | pubblicato su Coinage
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