Home Explore Topics Everything You Need To Know About Crypto Insurance

Everything You Need To Know About Crypto Insurance

339
0

Ever since it was released in 2008, Bitcoin has helped propel cryptocurrencies and the blockchain to become some of the most sought-after financial assets around. Despite the volatility in its price movements, investors and even financial institutions believe in its viability as an investment due to their trust in its long-term value. In fact, KPMG Canada is among the most prominent in the financial sphere to add crypto tokens like Bitcoin and Ether to their balance sheet.

You yourself may be considering or are already investing in crypto. If so, you might be wondering if there are any additional precautions you can take to keep your assets safe from untoward events like price volatility and cyber theft. Fortunately, there is: it’s now possible to insure your crypto holdings. But what exactly does that mean? We dive into the details below.

What is crypto insurance?

Currently, we subscribe to services like corporate insurance, life insurance, and health insurance to prepare for any risks or unwanted incidents we may encounter in our day-to-day activities. The same basic principle applies to the world of cryptocurrency. In our post ‘What is Cash Value? Should a Policyholder Care About It?’, we discussed how investments like real estate and the stock market are definitely a better way to accumulate a profit than, say, waiting for your life insurance’s cash value to reach a certain amount. However, it’s also true that every investment comes with some risk. In crypto, users can fall victim to phishing, hacking, and fraud as criminals attempt to steal their holdings. Though crypto isn’t currently insured by the FDIC, a number of private providers offer policies that can be tailored to suit a crypto investor’s specific needs. These are meant to cover incidents of theft, such as hacking and exploitation.

Crypto Insurance Canada - Best Insurance Online -

How is crypto insured?

As a crypto investor today, you have many options with which you can insure your digital assets. There are direct-to-consumer providers like Breach Insurance. Its “Crypto Shield” product recognizes over 20 different coins, has policies covering amounts ranging from $2,000 to $1 million, and gives users the ability to choose their deductible of the policy amount. On the other hand, you can opt for crypto wallets with integrated insurance policies. Ontario-based Wealthsimple Crypto is the first of its kind to be regulated in the country. Its decentralized lending protocol Maker uses partnerships with qualified custodians like Gemini Trust Company and Coincover, who provide the expertise necessary to secure crypto assets on the platform’s crypto wallets. Finally, you can also try trading on insured crypto exchanges like Coinbase, which has a $255 million crime insurance policy.

Will crypto insurance matter in the future?

Given the lack of regulation surrounding crypto, you may be wondering if it’s worth insuring your crypto assets in the first place. Those who believe the industry lacks potential argue that crypto is a fad that will soon fade. By extension, they believe that crypto insurance isn’t worth looking into. However, current trends confirm that the industry is booming and will only keep growing moving forward. Crypto continues to enter the mainstream as more merchants accept it as payment. Even the Bank of Canada is conducting research in the hopes of creating its own digital currency. This makes it abundantly clear that crypto is here to stay — as are the risks associated with it. Consequently, you might want to seriously consider looking into different insurance providers and compare their policies if you wish to invest in crypto as early as today.

LEAVE A REPLY

Please enter your comment!
Please enter your name here