Asian cryptocurrency exchanges to face insurance hurdles

Thursday 20 December 2018 10:20 CET | News

Asian cryptocurrency exchanges and traders have been struggling to insure themselves against the risk of hacks and theft, according to Reuters.

This fact might be deterring large fund managers from investing in a nascent market yet to be embraced by regulators. Once more crypto investors would apply for insurance, crypto enthusiasts can show that the crypto industry has solved the problem of storing digital assets safely following the reputational damage of a series of thefts, and allow it to attract investment from mainstream asset managers.

So far, over USD 800 million worth of cryptocurrencies were stolen in the first half of 2018 according to data from Autonomous NEXT, a financial research company.

Insurance might allay some of the regulators’ concerns around cyber security, the online publication continues. Hong Kong’s Securities and Futures Commission said it was exploring regulating crypto exchanges, and signalled that the vast majority of the virtual assets held by a regulated exchange would need insurance cover.

Still, one cryptocurrency broker, declining to be named because of the subject’s sensitivity, said insurers struggled to understand the new technology and its implications, and that even those who were prepared to provide insurance would only offer limited cover.

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Keywords: cryptocurrency, cryptocurrency exchanges, Asia, insurance, identity theft, cryptocurrency theft
Countries: World