Bittrex crypto exchange got $300 million in digital asset insurance secured against theft and conspiracy for the crypto that it holds in its cold storage. The exchange made an official announcement on January 29 in a blog post confirming that it obtained specialty insurance for corporations supplied by insurance firm Lloyd’s of London.
The insurance was secured after the exchange sought advice from a major insurance broker and adviser Marsh. Sarah Downey, the co-leader of Marsh’s digital asset risk transfer team, stated:
“We worked closely with Bittrex to create a tailored insurance solution to fit their specific cryptocurrency needs.”
Lloyd’s has engaged in several other deals in the past. The firm started insuring crypto custodian Kingdom Trust in late August 2018. Also, the company began to protect the hot wallets of Coinbase crypto exchange in April 2019.
Insurance Comes In the Crypto Sector
Bittrex allegedly got this insurance after it demonstrated its internal security and compliance protocols. Bill Shihara, the exchange’s CEO, said that insurance is another layer on top of the exchange security that offers extra assurance for its clients.
Insuring crypto businesses is quite hard since there are high risks of managing the crypto assets. Earlier this January, an executive working at the Winklevoss’ Gemini Exchange said that the firm had launched its local insurance company to cover at least $200 million in assets for its custody solution.
The recent analysis explains that insurance in the crypto space is a prerequisite to bringing in more institutional investors. In the case involving Gemini, it is thought that the new insurance will help. It will enable the exchange to meet the regulatory needs of institutional clients.