To protect the deposits of its traders, Bittrex announced, with a post published yesterday on its blog, that it has underwritten insurance policies for 300 million dollars in order to protect itself against the risk of theft of funds stored in cold storage.
These policies were underwritten with the main insurance company in the world, Lloyd of London, thanks to the intermediation of the insurance broker Marsh; Sarah Downey, Marsh's digital risk manager, said that:
We worked closely with Bittrex to create an insurance solution tailored to meet their specific needs
Lloyd's has already been active in the cryptographic space for at least two years, as reported by cointelegraph in an article published a few hours ago, in fact, already in August 2018 the company had insured Kingdom Trust, while in April a year ago it had been Coinbase to take out insurance policies very similar to those that Bittrex has signed today.
Bill Shihara, CEO of the cryptocurrency exchange, explained that in order to obtain bittrex insurance coverage he had to demonstrate the solidity of the internal security measures adopted and compliance with the required standards.
Until just a few years ago, underwriting this type of product for exchanges was practically impossible because the risk was considered excessive by insurance companies; the fact that today this is possible, even if it is not exactly easy or accessible to anyone, shows how much the cryptographic industry has grown and matured in recent years.
It should also be considered that the underwriting of adequate insurance coverage is one of the compliance requirements indispensable to operate legally and to allow exchanges to obtain institutional legitimacy; in this sense, therefore, bittrex is confirmed as one of the most solid and reliable exchanges in circulation, even though in terms of volumes it is only eighteenth among the main global platforms.
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