Guest blog, Sharon Henley, Product Strategy: Advancing Blockchain and Frontier Technologies
The insurance safety-net about to grow the next wave of Bitcoin adoption.
As the cryptocurrency market heats up again and a new wave of crypto-curious are standing by at the ready to jump in, there is just one thing keeping them from taking the plunge; a safety net.
While global cryptocurrency penetration today is at no more than 5%, a recent survey by Grayscale Investments has shown that over 30% of individual investors are interested in acquiring cryptocurrency in the near future. The same survey also showed that for the 75% of those interested in getting into crypto, the number one fear holding them back is the fear of crypto asset crime.
This isn’t surprising.
One only has to glance at the crypto press to see alarming headlines of an exchange getting hacked, unscrupulous employees stealing client funds or the latest cryptocurrency scam to defraud unwitting victims. And it’s not unfounded. Conservative estimates indicate that as much as $40 Billion worth of cryptocurrency has been lost or stolen since 2010, a figure that equates to roughly 16% of the $250 Billion valuation of the market. And cryptocurrency crime doesn’t seem to be dissipating anytime soon. Criminals find the decentralized, semi-anonymous nature of cryptocurrency uniquely appealing. 2019 saw more scammers than ever take advantage of the crypto-curious with eye-watering estimates of $4.3 Billion worth of cryptocurrency being taken from victims. 2019 also saw more cryptocurrency hacks than any other year as criminals got more sophisticated.
But there is another way. A lot that can be done to remove or mitigate the risks around cryptocurrency. And this is where Coincover comes in.
As CEO and Co-Founder of Coincover, David Janczewski, puts it
“It’s time to clean up the reputation of the industry and deliver solutions to the market that eliminates the new risks created by cryptocurrency ownership and in turn make it easy for customers to adopt. Coincover was founded with a mission to make cryptocurrency ownership completely safe and enable adoption for the large and fast growing crypto curious market.”
Coincover delivers on this mission through its unique cryptocurrency risk mitigation technology platform which provides risk prevention and mitigation solutions. For businesses looking to deliver cryptocurrency to their customers, Coincover is able to offer a complete, risk mitigated solution to meet this growing need.
Recent announcements of cryptocurrency insurance options have certainly helped add credibility to the market. But many of these current solutions only partially cover the needs of protecting crypto assets. Digging deeper it is often found to only be funds stored off-line in cold storage that are covered and even then, the coverage often doesn’t cover the full amount of assets under management. Coincover delivers protection in a multitude of ways from deposit protection, to fund recovery, to asset insurance and secure trading. Coincover is the first and only solution to provide full protection of cryptocurrency at the individual level ensuring customer’s funds remain with the customer and can never be lost or stolen. It was also the first to deliver on an inheritance solution to ensure beneficiaries can retrieve cryptocurrency should the owner die.
But when it comes to risk mitigation, this is only part of the big picture. To bring credibility, trust and security to the space it’s about looking at the whole cryptocurrency ecosystem. It’s about ensuring all risks are mitigated to safeguard businesses dealing in cryptocurrencies as well as for their customers. While loss and theft are the biggest concern for consumers, business must not only mitigate criminal risks but must also mitigate operational and regulatory risks while providing the flexibility and accessibility their customers require. Coincover also delivers a solution for this.
Coincover enables businesses to be regulatory compliant. The platform was developed with industry experts and regulatory affairs teams covering all aspects of customer onboarding, KYC checks and 5AMLD compliance. As legal and regulatory policies start to get further ironed out, Coincover can help businesses ensure they operate on the right side of the regulatory perimeter.
Cutting edge technology plays a crucial role in the Coincover platform solution. With both risk mitigation and in-built scalability to deliver the safest and most secure way to be in crypto as the market evolves. This outlook is why Coincover chose to partner with BitGo, the market leader in corporate-grade multi-signature wallets. Together we are able to provide complete control and continued access to funds while protecting those funds against all types of loss.
Mike Belshe, CEO of BitGo and a strong believer in Coincover from its inception adds
“It is not always easy for some clients to understand under what circumstances their investments are insured and to what extent their loss would be covered but, in partnership with Coincover, we are changing that.”
Looking forward there is no shortage of opportunities to further help adoption in the crypto space. The DeFi space is just one area that is showing huge potential. DeFi, or Distributed Finance, is a new paradigm shift towards a new decentralized, open financial economy. Many new players are coming to the market with products and services from crypto backed borrowing, lending, and savings to investment loans. While the space remains relatively new we are only just starting to see the potential. There is already a strong and growing demand for maintaining direct digital asset ownership alongside an insurance backed protection, both of which Coincover is uniquely able to deliver today.
As the crypto market evolves and new and exciting opportunities arise, the Coincover technology platform and insurance solutions will continue to provide the safest way for more businesses and customers to participate.
So, in a world of scary headlines, there is indeed cause for optimism. With Coincover addressing the key issues around risk, mass-market adoption can be unlocked. Today Coincover is already working with dozens of crypto businesses and is ready to help even more protect their customer’s digital assets no matter what risks may come.
Coincover is regulated by the UK Financial Conduct Authority with insurance underwritten by five A-rated Lloyds of London members.
If you are a crypto expert or entrepreneur who is interested in finding out more about insurance, or an insurance professional ready to champion crypto or collaborate on projects, please get in touch with the Gateway for a no strings attached chat.