The policy, issued in partnership with UK-based insurtech Nayms, covers electronic theft and phishing risk, with collateral denominated in Bitcoin provided by MakerDAO.
“CoinList has been the premier platform to connect early adopters with high-quality token projects,” said Scott Keto, chief operating officer of CoinList. “As those projects have matured, CoinList has naturally evolved to support those projects and their backers through our spot exchange and mobile wallets, which demand sophisticated risk management solutions. Yet, despite the high demand for crypto insurance products, the market is still nascent and rudimentary. We are excited to partner with Nayms, Breach, and MakerDAO to build out and scale insurance and reinsurance solutions suitable for our sophisticated partners.”
The policy was inspired by a shortage of reinsurance capacity available to crypto risks and the need for the insurance industry to identify complementary sources of reinsurance capacity and collateral, Breach said. The company’s partnership with Nayms allows it to cover complex crypto risks at scale, similar to policies that cover traditional catastrophic risks in the P&C and surplus lines sectors.
“At Nayms, we are building the bridge between capital and risk for digital assets,” said Dan Roberts, co-founder and CEO of Nayms. “That bridge is a regulated environment, using key technologies adopted by sophisticated entities. Breach [is] one of those entities, with a strong solution that will, in partnership with Nayms, enable scalable cover for this emerging risk class.”
“It’s no surprise that crypto markets have historically been perceived as risky, said Meltem Demirors, chief strategy officer at CoinShares. “It is very challenging to hedge against the variety of risks Bitcoin presents – nascent, novel market structures and new types of operational risk presented by a purely digital asset that settles with finality require new approaches to insurance. The launch of this new product from Breach will bridge traditional financial insurance products with the latest in cybersecurity to bring trust and protection to digital finance.”
“As regulated insurance options for crypto risks continue to lack innovation and are generally un/underserved, Breach is grateful for the opportunity to serve the needs of the crypto market, including retail and institutional investors, custodians, exchanges and technology companies, amongst others,” said Eyhab Aejaz, CEO of Breach. “The insurance industry lacks deep crypto expertise, while the crypto industry lacks deep insurance expertise, so we fit a significantly important niche and are quite excited about it.”
Source: Insurance Business Magazine
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