Crypto Wealth Faces Rising Threats: Insurers Introduce Kidnap and Ransom Policies

Surge in Crypto-Related Kidnappings Prompts Insurance Innovation

The rise in cryptocurrency’s popularity has unfortunately been paralleled by an increase in targeted kidnappings and ransom demands. High-profile crypto investors and executives have become prime targets due to the decentralized and often anonymous nature of digital assets. Recent incidents, including the attempted kidnapping of Pierre Noizat’s family, co-founder of French crypto exchange Paymium, highlight the growing risks faced by individuals in the crypto space.

In response, insurance companies are developing specialized kidnap and ransom (K&R) policies tailored for crypto holders. These policies aim to provide financial protection and crisis management support in the event of abduction or extortion related to digital assets. Rebecca Rubenfeld, COO of AnchorWatch, noted the heightened concern among crypto professionals, stating that fear of violence was a dominant topic at a recent Bitcoin Conference in Las Vegas.

Insurance Industry Adapts to New Threat Landscape

Traditional K&R insurance has long been utilized by corporate executives operating in high-risk regions. However, the unique challenges posed by cryptocurrency—such as irreversible transactions and the difficulty of tracing digital funds—have necessitated the development of new insurance solutions. Andrew Kurt, VP of Executive Risk at Hylant Capital, emphasized that while the frequency of such incidents may be low, the severity is significant, warranting specialized coverage.

Relm Insurance is among the firms finalizing K&R offerings for the crypto market. CEO Joseph Ziolkowski highlighted the complexity of pricing these policies, which require detailed assessments of a client’s physical and cyber defenses. Factors such as 24/7 personal security and robust cybersecurity measures can influence premium costs, reflecting the tailored nature of these insurance products.

Global Incidents Underscore Urgency for Protection

The international scope of crypto-related crimes underscores the urgency for protective measures. In South Korea, authorities arrested a Russian national involved in an attempted robbery during a fake crypto deal, aiming to steal approximately $730,000. Such incidents are not isolated, with reports of kidnappings and extortion attempts surfacing in various countries.

As the crypto industry continues to grow, so does the need for comprehensive security strategies. Beyond insurance, many crypto professionals are seeking personal security services to mitigate risks. Firms like Infinite Risks International have reported increased demand for bodyguards and protection contracts from high-profile individuals in the crypto space.