July 16, 2024

Insurance companies focus on the cryptocurrency space

April 10, 2024
2Min Reads
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Recent product announcements suggest that the insurance sector is shifting its focus to the dangers associated with digital assets and cryptocurrencies.

A digital asset custody insurance product designed for the asset servicing market has been introduced by insurance broker March.

According to Marsh, the new business line will be the largest product of its kind, with capacity supporting US$825 million.

It is intended to assist businesses that hold digital assets offline in cold storage as well as those that require additional custodial services like multiparty computation.

"We look forward to supporting clients globally in aligning their risk financing and evolving commercial strategies, as they focus on building their operational resilience and market presence in this fast-growing sector," stated Jacqueline Quintal, global digital asset leader at Marsh Specialty. "Marsh's facility provides custodians with protection for the key operational risks they face in the management of digital assets."

 

In the meantime, M2 Recovery, a UK-based boutique insurer, claims to have released the first bitcoin legal expenses insurance policy ever.

According to M2 Recovery, the program was introduced in response to an increasing wave of cryptocurrency fraud. Between 2022 and 2023, the amount of blockchain transactions impacted by fraud more than doubled.

However, it usually costs victims of cryptocurrency investment scams more than £250,000 to look into and retrieve lost cryptocurrency assets.

Neil Holloway, the founder of M2 Recovery, said, "Our insurance policy is the first of its kind globally, which provides policyholders with legal expenses following crypto fraud."

 

"We can cover investors', neobanks', and in-play betting organizations' legal costs associated with crypto assets worth tens of millions of dollars combined.

According to Holloway, "this includes cryptocurrency assets appropriated through man-in-the-middle attacks, utility tokens like Freeway Tokens, and digital assets invested through the metaverse." Reducing your exposure to risk on significant cryptocurrency investments is more crucial than ever because there are more investment scams operating than ever before.

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