BitGo secures additional US$600m of cold storage cover

London broker Paragon has helped to secure the largest programme of over US$700m of cold storage insurance capacity for digital asset financial services company, BitGo.

In 2020, BitGo became the first digital asset custodian to offer clients the ability to purchase their own dedicated excess limits above BitGo’s US$100m ‘all customer’ crime/specie policy at pre-agreed rates. Since then, the offering has expanded by over US$600m, making it the largest in-force cold (offline) storage specie programme placed to date.

“BitGo was one of the first service providers to build a strong insurance programme for crypto,” said Mike Belshe, CEO of BitGo. “Today, due to BitGo’s technology and scale, we’re able to offer a lower cost dedicated customer insurance programme on top of BitGo’s secure cold storage system. This milestone demonstrates that the offering has been very popular with clients seeking the ultimate secure and insured storage.”

Nick Edwards, lead underwriter on the programme and head of specie at Canopius, said: “We are pleased that the dedicated customer excess specie insurance we put in place in 2020 has delivered in supporting BitGo’s Custody offering. In less than 18 months, we have seen committed capacity to the BitGo cold storage programme increase seven-fold, which attests to the quality of its secure solution and the appetite among institutional investors for such a programme.”

San Francisco-based brokers Woodruff Sawyer partnered with Paragon to broker the programme. “It’s very exciting that we were able to expand this programme to accommodate the needs of BitGo’s clients,” said Jacob Decker, vice-president, director of financial institutions at Woodruff Sawyer. “As we see more institutional clients coming into crypto, it’s vital that we keep innovating to ensure that demand is met. This is a new world and our London partners Paragon did a phenomenal job educating the market and expanding support from both existing partners, as well as bringing new carriers into this emerging product.”

Paragon partner, William Wright added: “This recent milestone is fantastic news for BitGo, BitGo's clients, the insurance market and any coinholder looking to protect their crypto assets.

“Yes, the insurance market remains extremely challenging for any crypto business seeking directors' and officers', professional liability, crime and/or cyber insurance. However, to have evolved from an embargo at Lloyd’s of London for crypto risks in 2017, to a US$700m cold storage specie programme in 2021... this is something to be really excited about. The insurance community has come a long way, and there is plenty to be optimistic about as we consider new, pioneering insurance solutions for crypto related businesses in the future.”

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