Today BitGo the company that claims to process more than 15% of all Bitcoin transactions, announced two new digital asset insurance solutions. The first offering is for customers that use BitGo for custody. Digital assets up to a total of $100 million are insured by Lloyd’s of London. While that’s quite an achievement, it’s a relatively small amount when BitGo claims to process $15 billion a month in cryptocurrencies and has over $2 billion assets “in wallet”.
Custody insurance
The insurance cover is automatic but relates to offline keys in custody at BitGo and covers third-party hacks and theft, insider theft, and physical loss or damage of the keys.
Mike Belshe, CEO, BitGo, commented that “it is not always easy for some clients to understand under what circumstances their investments are insured and to what extent their loss would be covered. We are changing that by being more transparent than any other company about the terms of our coverage. Transparency and accuracy is essential for building trust in the market.”
An AmTrust Lloyd’s syndicate underwrites the insurance, and it’s brokered by Woodruff-Sawyer & Co. and Paragon International. They’re working on accommodating dedicated limits to individual customers.
AmTrust at Lloyd’s head of Fine Art & Specie, Nicholas Edwards said: “Following a thorough review of BitGo’s security and controls we are delighted to have delivered an innovative solution that enables our client to develop and grow its business with confidence and security.”
Wallet insurance
The second BitGo insurance solution is for assets not in custody but held in BitGo Business Wallets. These clients will be able to purchase cover for theft or lost keys through a new London startup, Digital Asset Services. However, the product is not quite ready for launch yet.
There’s a past connection between Digital Asset Services (DAS) and BitGo through DAS CEO David Janczewski who was previously Director of New Business Ventures for the Royal Mint. While at the Royal Mint a digital wallet was developed with BitGo.
The BitGo wallet was to be used for a plan in conjunction with the Chicago Metal Exchange (CME) to create a digitized gold offering called Royal Mint Gold (RMG). But in late 2017 the CME pulled out when the project was at an advanced stage. Janczewski subsequently left the Royal Mint.
The UK’s Financial Conduct Authority regulates DAS, and to date, the startup has raised £400,000 ($520,000) in equity funding.
“Our goal is to make digital currency safe and accessible to all by providing total peace of mind for anyone who is currently holding cryptocurrency, or anyone who might be on the outside looking in and just needs that extra bit of reassurance before investing,” said Janczewski.
