Gemini, the crypto exchange founded by Cameron and Tyler Winklevoss, has created its own insurance company to protect clients against the potential loss of coins from its offline vaults - with a possibly record-breaking $200 million coverage limit.
Announced Thursday, the captive insurer will provide coverage for customers of Gemini Custody, the crypto cold storage service of Gemini Trust Company.
Aside from its size, the Gemini policy is another sign the once-meager supply of insurance coverage available to crypto firms is growing - even if they have to create some of it.
Last year, insurance broker Aon and crypto exchange Coinbase announced plans to create a captive; Aon said it had captive creation deals with other exchanges in the pipeline.
Gemini's new policy, which supplements its captive with coverage from outside insurers, has "The largest limit of insurance coverage currently available by any crypto custodian in the world," said Yusuf Hussain, the company's head of risk.
Other large crypto insurance offerings were previously reported by insurance brokerage Marsh's Blue Vault, which provided $150 million for coins kept in cold storage.
Gemini's captive insurance company is dubbed "Nakamoto" after bitcoin's mysterious creator, and licensed by the Bermuda Monetary Authority.
The excess coverage, for the most part, was placed through the Marsh Blue Vault facility and was led by the Lloyd's syndicate Arch Insurance International in the U.K., said Downey.
"The captive is the primary layer, and the traditional insurance markets are taking the excess layers - and then beyond that customers can procure additional insurance on a client-by-client basis," he said.
He would not disclose how much of that is being stumped up by Gemini itself in the form of the captive but said, "A majority of it is provided by traditional insurance markets."
Winklevoss-Led Gemini Exchange Now Has Its Own Insurance Company
Published on Jan 16, 2020
by Coindesk | Published on Coinage
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