‘Nakamoto’ will provide $200 million worth of coverage to Gemini customers
Winklevoss twin-led cryptocurrency exchange and custodian, Gemini announced the launch of Nakamoto, Ltd. a captive insurance company licensed by the Bermuda Monetary Authority [BMA]. With this, Nakamoto becomes the world’s first captive to insure crypto custody.
Cameron Winklevoss, President of Gemini said,
“Insurance is one of the main barriers to crypto mass adoption. Gemini has created a captive insurance company to address this. Obtaining meaningful insurance in the crypto industry remains a challenge, and our captive will help to increase our insurance capacity and move the industry forward.”
The official release stated that Nakamoto will enable Gemini Custody to increase its insurance capacity beyond the coverage that is currently available in the commercial insurance market.
Additionally, Gemini Custody, which is regulated by the NYDFS, will have insurance coverage of $200 million, which according to the post, is the largest limit of insurance coverage purchased by any crypto custodian in the world.
The post further read,
“Gemini customers can now also purchase additional insurance for their segregated crypto assets. In addition, we have Hot Wallet insurance coverage for your crypto we hold in our online Hot Wallet. Lastly, U.S. dollar deposits held at Gemini are eligible for FDIC ‘pass-through’ deposit insurance.”
While speaking about the current scenario of the space, Yusuf Hussain, Head of Risk of Gemini stated that the crypto industry lacks insurance coverage as opposed to its availability in traditional financial markets. The exec added,
“Gemini recognized this gap and collaborated with two of the world’s largest insurance brokers, Aon and Marsh, to solve for this.”
The NY-based platform has collaborated with captive insurance jurisdiction, Aon and Marsh’s Digital Asset Risk Transfer to incorporate Nakamoto in Bermuda. Besides, Gemini had launched Gemini Custody in September 2019 with the initial support of 18 cryptocurrencies.