In regards to the alarming rate of theft in the crypto industry, Lloyds of London, one of the world’s oldest insurance firms, has secretly created an insurance coverage for a crypto firm to protect their digital assets from future theft.
According to a Tuesday report, Kingdom Trust, a firm that stores digital assets including BTC and ETH, has secured insurance for all digital assets in its custody from a syndicate of Lloyd’s of London.
The Broke responsible for the insurance cover, Safe Deposit Box Insurance Coverage (SDBIC), stated that it could be because many institutional investors are still hesitant due to the nature of cryptocurrency investments.
The move by Kingdom Trust came as a milestone, going out to seek protection for crypto firms that store digital assets. The company, known as custodian of digital assets, has over USD 12 billion worth of assets and has demonstrated to the public that it is not ready to gamble with clients’ investments, by securing an insurance coverage with Lloyds.
Attracting Institutional Investors
According to Matt Jennings, CEO of Kingdom Trust, this came as a result of the company’s improved technology and robust security protocols. The main idea is to attract more institutional investors who before now have steered clear from investing in digital currencies due to “concerns about its volatility,” some investors said.
“We serve both institutional and individual investors by providing qualified custody, which gives our clients the framework they need to ensure compliance with their regulators using clear and transparent reporting,” Jennings said.
The Corporation of Lloyds, an umbrella body that oversees and supports syndicates offering insurance services to firms, did not say much about the development, but only advised its associates to tread with caution on providing insurance cover for crypto-related firms.
Jennings, on the other hand, refused to comment on the name of the insurer, the cost, and other terms of the insurance.
Kingdom trust has been looking for a competent insurance firm since its launch in 2010, but its search for one became intensified after various efforts proved futile. Its efforts have yielded positives and it finally signed a deal with a reputable firm like the Lloyds of London.
More Insurance Firms to Provide Cover for Crypto Firms
Before now, it was evident that insurance companies did not want to offer insurance cover to digital assets firms. However, insurance firms like AIG, XL Catlin, are gaining interest in the crypto industry even though they are still trying to keep a low profile about the whole development.
President of SDBIC, Jerry Pluard, said that about ten syndicates in Lloyds are beginning to indicate interest in providing cover for crypto firms.
“Of those 10, I would say there are five that have the level of expertise that allows them to be comfortable enough to do the analysis and underwriting of the risk, and then the other five will follow on with those leads in writing exposure.”