The Winklevoss-led crypto exchange, Gemini, recently announced an increase to its custody platform’s insurance coverage. The increase brought the coverage up to $200 million, which makes Gemini a trading venue’s cold storage insurance limit the largest one in the world.
The move is a signal to many that Gemini’s custody service, Gemini Custody, expects that the demand will skyrocket in the near future. While it remains unknown what the platform expects to happen, it is clear that it foresaw serving an increased number of large, accredited crypto investors.
Gemini now has its own insurance provider
As some may remember, Gemini also launched its own insurance provider known as Nakamoto. The provider was named after Bitcoin’s mysterious creator, Satoshi Nakamoto. The new company even managed to obtain a license by the Bermuda Monetary Authority. Now, according to the exchange’s announcement, Nakamoto will provide Gemini Custody’s clients with fund coverage of up to $200 million.
Furthermore, the exchange itself will benefit from the increased insurance coverage, as Nakamoto offers insurance for hot wallets, as well as segregated crypto assets. The new company comes as a result of a collaboration with two other insurance brokers, Aun and Marsh.
Thanks to these two experienced insurance partners, Winklevoss-led crypto exchange stated that Nakamoto will tap into much broader insurance markets, and provide significantly higher coverage, while still maintaining optimum costs.
The exchange’s Head of Risk, Yusuf Hussain, commented on the move by saying that insurance is essential for both, growth and health of modern financial markets. With that in mind, Gemini is proud to see it increase.
The move could have numerous positive consequences for the future of the entire crypto industry. As many likely know, the crypto space has long awaited the arrival of institutional investors, who hesitated to join due to regulatory uncertainty and high risk.
With new developments, the crypto space has been becoming more and more attractive to institutions, and increased insurance is bound to play a vital role in making them feel safe and protected while trading crypto.