The Gemini crypto exchange owned by The Winklevoss’ just announced that it was introducing an insurance firm. This new introduction is meant to cover more than 200 million dollars in crypto assets currently under Gemini Custody. At the moment, it’s believed that this is by far the biggest sum known for any global custody service dealing with cryptocurrencies.
— Gemini (@Gemini) January 16, 2020
Yusuf Hussain, the head of risk at the firm on January 16th got to share this news with the public through an interview held with Cointelegraph. Yusuf noted that this insurance company will operate under the name Nakamoto Limited. Once operational, it will be charged with ensuring that it gets to secure the custody side of the Gemini company to a tune of two hundred million dollars.
Traditional Insurance Brokers Consulted Before the Launch
Marsh and Aon, which are renowned traditional insurance brokers were some of the companies that assisted with the launch of Nakamoto Limited. It’s expected that existing clients of Gemini Custody will also get an opportunity to purchase extra insurance from Nakamoto.
This will be for clients who would like to provide additional insurance beyond the two hundred million dollars on offer. Hussein went on to state that:
“The advancement in the company’s custodial coverage will allow a number of Gemini’s institutional clients to continue to meet their own regulatory requirements.”
He was also quick to note that:
“The measures that had been taken by Gemini were consistent with its approach of being a security-first, compliance-first, and regulatory friendly exchange and custodian.”
It’s worth noting that the custody wing was first introduced to the public by Gemini in September 2019.
Insurance in the Crypto Verse
Many traditional financiers looking to invest in crypto have in the past been restricted by the lack of insurance services that would help protect their digital assets.
In the past few months, several companies have stepped up to try and bridge this gap with some of the most notable ones being Lloyds which is based in London. Lloyds is tasked with safeguarding crypto asset wallets (hot wallets) for Kingdom’s Trust and Coinbase.