Bitstamp Introduces Crime Insurance to Further Protect Customers’ Funds

By AIT News Desk On Oct 19, 2020

Bitstamp, the world’s longest-running cryptocurrency exchange and one of the largest by trade volume, announced they have expanded the insurance offered to their customers with an additional crime insurance policy.

The new crime insurance policy is offered by specialist insurance brokers, Paragon International Insurance Brokers in coordination with Woodruff-Sawyer, and underwritten by various insurance companies and certain syndicates at Lloyd’s of London. The policy covers an array of crime-related cases, such as employee theft, loss while the assets are stored at any premises, loss in transit, loss caused by computer fraud or funds transfer fraud, and loss related to legal fees and expenses.

“Our crime insurance policy is designed with the specifics of digital assets in mind,” said Jeff Hanson, Senior Vice President at Paragon. “Traditional insurance policies do not translate directly into digital assets, which is why we’ve created and placed a policy to fit the bespoke requirements of highly respected and forward-looking exchanges such as Bitstamp, which value the safe custody of their customers’ funds above all else.”

“Bitstamp has taken a pro-active approach to operating within relevant regulatory frameworks, has strong risk management personnel and a culture of doing right by their customers” said Jacob Decker, Director of Financial Institutions at Woodruff Sawyer. “It has been a pleasure working with the Bitstamp team to develop a tailored solution to reinforce protections for their customers.”

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Bitstamp stores 98% of its digital assets offline with BitGo, a leading provider of institutional digital asset storage solutions. These offline assets were already insured by BitGo’s own insurance policy. With the new crime insurance policy supplementing this existing coverage, Bitstamp now offers an enhanced level of protection for the assets it manages on behalf of over four million customers worldwide, including assets in transit and assets held in its hot wallets.

“Custody and insurance are one of the most crucial and quickly developing areas in crypto right now,” said Miha Grčar, Global Head of Business Development at Bitstamp. “Introducing an additional crime insurance policy allows us to expand coverage to the assets held at Bitstamp and to protect our customers in a large array of scenarios they may find themselves in.”

Widely regarded as a pioneer of blockchain security solutions such as cold storage and MultiSig wallets, Bitstamp is keeping itself at the forefront of customer protection, which both secures existing customers and enables more risk-averse players from traditional finance to enter the digital asset market. By offering additional insurance coverage, the exchange has taken another step towards strengthening the bridge between crypto and traditional finance.