Leading cryptocurrency exchange Coinbase has revealed the extent of its insurance coverage for customers’ crypto that is being stored on the platform.
In a candid display of transparency, Coinbase published a blog post confirming that $255 million is covered for coins held in hot wallets.
The firm holds less than 2% of customers’ assets in hot wallets, with the vast majority being held in cold storage wallets.
The blog post stated: “Coinbase has held an insurance policy covering cryptocurrency in our hot storage systems continually since November 19, 2013. The rationale has remained the same the entire time: if the worst happens and Coinbase loses customer funds, customers deserve certainty that they will be made whole.”
Coinbase went on to confirm that the $255 million of insurance coverage is held through Lloyd’s registered broker Aon and sourced from a global group of US and UK insurance companies.
Coinbase has built an industry-leading insurance program to protect our customers’ assets. Our Chief Information Security Officer, @SecurityGuyPhil, shares an overview of our coverage along with thoughts on the future of crypto insurance. https://t.co/8LdIhRW7ND
— Coinbase (@coinbase) April 2, 2019
Looking at the future, the exchange wrote that the market has “matured significantly since 2013”, and as a result there are a few gaps and “areas of exciting growth”.
“There is not enough risk transfer capacity in the market. We need more participants in this market. Coinbase is an active participant in educating the insurance marketplace to bring more insurers and more capital into the market,” the post continued.
The post also mentioned a possible solution to the insurance dilemma would be allowing owners of cryptocurrency to directly insure their assets with “trustworthy, well-reviewed, and transparent service providers”.
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