The Goldman Sachs-backed digital asset security company BitGo has announced its launch of "the most complete insurance offering in the industry" today, February 19. Providing protection for cryptocurrencies and digital assets held by either BitGo or its custodial service, BitGo Trust Company, customers will be able to insure up to $100 million worth of assets through long-established insurance provider Lloyd's of London.
According to the press release, the insurance plan comes at no additional cost to BitGo users and will cover losses in the event of third-party hacks or theft of private keys, insider theft by employees of private keys, and physical loss or damage of private keys. The straightforward coverage terms are part of what Mike Belshe, BitGo's CEO, hopes is the beginning of a trend to help clients in the world of digital assets; he says it is "not always easy to understand what circumstances their investments are insured and to what extent their loss would be covered."
For users who have a Business Wallet – a multi-signature, multi-coin transactional wallet offered by BitGo – the release also "pre-announces" insurance coverage offered by Digital Asset Services, a third-party insurance provider overseen by the UK's Financial Conduct Authority. Digital Asset Services is offering both theft protection and a key recovery service for those with a Business Wallet. Coverage will be purchased annually or when needed.
Of course, the insurance coverage announcement stands out in the cryptosphere, which is currently in the middle of a continuing saga surrounding lost investments. Canadian cryptocurrency exchange QuadrigaCX, which owes approximately $250 million to users in cash and cryptocurrency holdings, says it lost access to what it claims is $180 million in cryptocurrency stuck in cold wallets after the deceased founder and CEO took the company's private keys to the grave.
As for BitGo, back in October 2018, the security company was part of a joint effort with decentralized dark pool exchange Republic Protocol and on-chain liquidity protocol Kyber to develop the "wrapped bitcoin," an ERC20-compliant token backed 1:1 with bitcoin. The token was made available on the Ethereum blockchain in late January.