BitGo adds customer excess insurance above its existing $100 million custody policy
BitGo becomes first crypto custodian to offer insurance up to $100 million through Lloyd's of London, addressing institutional security concerns.
On March 18, 2020, BitGo adds customer excess insurance above its existing $100 million custody policy. BitGo becomes first crypto custodian to offer insurance up to $100 million through Lloyd's of London, addressing institutional security concerns.
The ability to offer substantial insurance coverage through a reputable, centuries-old institution like Lloyd's represented important progress in Bitcoin's maturation as an institutionally-acceptable asset class. Insurance had been a major obstacle to institutional Bitcoin adoption because traditional investment mandates and fiduciary responsibilities often required that custodied assets be insured against loss.
While specialized cryptocurrency custodians had emerged to serve institutional clients, many operated with limited or no insurance coverage due to the nascent cryptocurrency insurance market and uncertainty about risks and appropriate pricing. BitGo's $100 million policy demonstrated that traditional insurance underwriters were becoming comfortable assessing and pricing cryptocurrency custody risks, and that they believed reputable custodians with proper security practices represented insurable risks rather than unacceptable exposures.