Ever since their $65m settlement with Facebook founder Mark Zuckerberg in 2008, the Winklevoss brothers have been relentless.
The identical twins and venture capitalists turned their hands to Bitcoin in the early days, proposing the first Bitcoin ETF in 2013 (which was rejected four years later). Bitcoin ETF or no, the Winklevoss twins have proven their worth in this space.
The following year, they launched Gemini Trust Company LLC. As a cryptocurrency exchange and custodian, Gemini is one of the most trusted and respected in the industry.
Being regulated by the New York State Department of Financial Services (NYDFS) gives the company additional credibility when it comes to both retail and institutional investors.
The twins have an estimated net worth of well over $1bn between them.
Yesterday, on the company blog, Gemini made a surprise announcement. The company has launched Nakamoto, which will provide the highest level of crypto insurance in the industry.
— Tyler Winklevoss (@tylerwinklevoss) January 16, 2020
Gemini takes over BitGo with crypto insurance coverage
Rival cryptocurrency custodian BitGo is one of the most trusted in the space. Its wallets are covered by $100m Lloyd’s Insurance.
But thanks to the launch of Nakamoto (licensed by the Bermuda Monetary Authority), the Winklevoss’ can now provide customers with an insurance policy of up to $200m.
This means that the New York-based custodian now provides the highest custody insurance coverage in the cryptocurrency market. Head of Risk at Gemini Yusuf Hussain stated:
“This allows us to increase our insurance capacity beyond the coverage currently available in the commercial insurance market. This insurance solution gives Gemini Custody $200 million in insurance coverage — the largest limit of insurance coverage purchased by any crypto custodian in the world.”
Gemini customers can also purchase insurance policies on their crypto assets held in Gemini hot wallets. Deposits made in USD are also eligible for FDIC “pass through” deposit insurance.
A further step towards mass adoption?
One of the stumbling blocks to widespread adoption of cryptocurrency is the enormous amount of exchange hacks.
In the majority of cases, when cryptocurrency users have their funds stolen, they have no way of getting them back and no insurance company to turn to.
This latest move by Gemini is very encouraging as it could help onboard more users to the space. Hussain added:
“Insurance is essential to the health and growth of modern financial markets and we’re proud to bring insurance to the crypto markets — a critical next step on our mission — to empower the individual through crypto.”