American cryptocurrency exchange and custodian, Gemini Trust Company, revealed today that it has launched its in-house insurance firm as part of its effort to increase the safety of the cryptocurrencies in its custody.
The exchange calls the captive insurer “Nakamoto Ltd,” noting that it is based in Bermuda and licensed by the Bermuda Monetary Authority (BMA), per the announcement.
Nakamoto Ltd. provides Gemini with huge insurance coverage of $200 million, which is the company claims is the largest limit of insurance coverage purchased by any crypto custodian in the world.
The company has also provided its customers with other insurance solutions like the insurance of segregated digital assets and insurance of assets held in their Hot Wallet.
With the launch of the captive insurer, the Gemini now has a robust coverage against the theft of digital assets kept in its custody, which according to the blog post, will be higher than that provided by other commercial insurance companies.
Gemini is a registered New York trust company and is regulated by the Department of Financial Services in New York. As a result, it also takes care of insurance against fund transfer fraud, computer fraud, and employee theft as mandated by the state.
Insurance is a very important tool in the growth and development of any modern financial market and as such, Gemini’s bold step of bringing it into the cryptocurrency market is indeed a step towards empowering individuals using crypto.
In February 2019, UK-based crypto wallet service, BitGo, partnered with leading American insurance firm, Lloyd’s of London, to provide crypto users coverage of up to $100 million.