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Crypto Assets Risk Transfer Services

Innovative Crypto Assets Risk Transfer Advisory for Crypto Companies

Crypto Assets Risk Transfer Services

Crypto and blockchain insurance market is new, uncertain and rapidly changing. Risk management in this sphere has proven difficult, as insurers struggle with defining and quantifying risk.

One of the significant challenges is the large perceived risk of illicit activities within the crypto arena. This perception, whether warranted or not, has a direct impact on the insurance landscape, often resulting in heightened scrutiny and caution from insurers.

The complexity of the crypto and blockchain environment further compounds the challenge. The rapid pace of innovation means that the landscape is continually evolving, making it difficult for insurers to keep up with the latest developments and potential vulnerabilities.

Evolving regulations add another layer of complexity. Governments and regulatory bodies around the world are still in the process of defining the legal frameworks that will govern crypto and blockchain activities. These regulations are often inconsistent across jurisdictions and subject to change, creating uncertainty for both insurers and those seeking coverage.

All these factors contribute to the cost of insurance in the crypto and blockchain space being high. The perceived risks and complexities drive up premiums, while the limited historical data and lack of standardized risk assessment models make pricing a challenging exercise. Coverage options may be limited, reflecting the insurers’ cautious approach to this new and uncertain market.

Furthermore, obtaining coverage can be a complex and lengthy process. The need for specialized knowledge, detailed risk assessments, and careful negotiation of terms means that securing appropriate insurance is often neither straightforward nor quick. 

Crypto Risk Transfer Services

Cryptosec’s Crypto Assets Risk Transfer service offers innovative risk transfer advice tailored to the needs of companies operating with crypto assets. Our team is comprised of actuaries, former attorneys and claims specialists with deep knowledge of all forms of relevant financial and professional insurance coverage options. This diverse range of expertise allows us to provide a comprehensive service that covers all aspects of crypto assets risk transfer.

Crypto Assets Risk Transfer

What We Do?

Crypto Risk Transfer advisory service is a specialized offering designed to navigate the intricate landscape of risk management within the crypto world. As these digital assets continue to grow in prevalence and complexity, the need for tailored risk mitigation strategies becomes paramount. Our Crypto Risk Transfer advisory service provides expert guidance and solutions to identify, assess, and transfer risks, leveraging innovative approaches and deep industry insights.

Contract Review Regarding the Insurance Provisions, Limits, and Your Compliance

Cryptosec experts can help you identify how your contracts and other legal relationships may impact your insurance policies, how certain language may create certain obligations or change your coverage, or expose you to increased risks. We can help you ensure compliance with your insurance policies, and to help you balance the risks. We do this through contract reviews regarding the insurance provisions, your limits, and your compliance to those terms; sample language assessments; identification of third-party assumed liabilities; and other methods.

Director’s and Officer’s Liability Insurance

Director’s and Officer’s liability insurance, or D&O insurance, protects crypto companies and their executives. It covers claims brought by investors, shareholders, regulators, against the directors, officers and employees associated with things like a breach of a duty, securities violation, regulatory investigations, or proceedings. We can help you understand what kind of coverage you need, review your current policies, understand whether the regulatory coverage is adequate, etc. We specialize in knowing the specific risks in the crypto industry and helping you obtain adequate protection.

Commercial Crime / Cybercrime Coverage

Commercial crime and cybercrime coverage reimburses companies for loss, damage, destruction or theft of crypto assets in secure premises or in transit or transmission. It also covers internal and external fraud, including electronic / cyber theft, which would include protection for warm and hot storage wallets. We can help you define and select the appropriate coverage for your organization and help you comply with your insurance policies. We can also provide incident response and investigation retainers through our specialist Crypto Investigators business, potentially reducing your premiums.

Specie Coverage

Specie cover provides coverage for the loss of crypto assets from internal and external theft, damage or destruction of private keys, etc. while crypto assets are stored in secured locations. The idea behind specie insurance is to cover an asset at a specific location, such as a deep cold storage vault. We can help you understand applicability, benefits and limitations of specie insurance for your circumstances, as well as help you define operational risk management procedures and controls to prevent the losses as well as to prove losses for insurance purposes.

Alternative Risk Transfer Options

Alternative crypto assets risk transfer is the use of alternative techniques from traditional insurance to achieve the same hedging and transfer of risk away to another party or to capital markets investors and receive the same protection against certain risks. Some of the options may include include risk securitization through catastrophe bonds, insurance-linked securities and reinsurance sidecars, transforming capital market risks into reinsurance through transformer vehicles, captive insurance companies, risk retention groups, and other alternative risk financing techniques.

We can assist in the formation and operation of various alternative risk transfer mechanisms.

Reduce Your Risk Exposure Now

Allow our highly-qualified crypto assets risk transfer experts to help.