Why You Should Consider Cryptocurrency Insurance
Since the value of cryptocurrency began skyrocketing a few years ago, its success and prevalence had become increasingly hard to ignore.
Approximately 8,000 units of cryptocurrency and 4.7 million NFTs (non-fungible tokens) were registered in January 2022. The cryptocurrency market is extremely active with unprecedented volumes of transactions. Each day, more than $91.5 billion worth of cryptocurrency is traded through approximately 455 exchanges, 154 counties, and 120 million Bitcoin transactions.
Despite cryptocurrency being designed with security in mind, it’s too frequently stolen and lost; and these catastrophes don’t only happen to those who are unprepared and do not take security precautions. Over 1,500 bitcoins are projected to be lost each day throughout 2022.
As surprising as the loss is the number of ways in which cryptocurrencies are embezzled and go AWOL. 1 out of 5 Bitcoin is stranded as a result of misplaced wallets, making missing private keys a prominent issue. Ebbs within the cryptocurrency market also have a significant and detrimental impact. In 2018, Americans forfeited $1.7 billion in the cryptocurrency market. Lastly, approximately one out of every 1,500 cryptocurrency files will corrupt due to crashes and extortion.
The use of blackmail, ransomware, and fraud by exploiters has resulted in the theft of over $103 million. The tapping of systems, software, and cryptocurrency wallets has garnered over $7.4 million in theft. Ponzi schemes have stolen whopping totals from investors – collecting more than $2 billion. A notable method, investors receive unconsented profits from other investors through this form of fraud.
Due to the inherent volatility of owning cryptocurrency, the cryptocurrency insurance industry is growing rapidly, with its current value exceeding $3 billion. The following items qualify for cryptocurrency insurance: exchanges, mining, custodial, payment processing, wallets, infrastructure, and financial service platforms among others.
Though it’s not available for personal insurance, business cryptocurrency insurance is an important offering. You can protect shares of your cryptocurrency investments, and protect your financial wellbeing, from theft, scams, and losses in general, all with flexible limits. Cryptocurrency insurance can protect businesses from various risks, supplementing existing protection plans.
As with any type of insurance, it is best to begin by pinpointing your insurance needs for your cryptocurrency or NFT, and decide whether you need fraud insurance, exchange insurance, business cryptocurrency insurance, mining insurance, custody insurance, or DeFi insurance. After deciphering the kind of coverage you’ll need, find and compare quotes from a variety of providers. Using this information, you can narrow down which insurance premium is the best fit for your cryptocurrency circumstance and budget.
It’s wise to conduct background research and explore cryptocurrency insurance rates before investing in cryptocurrency. The good news is that with innumerable plans that vary in price, amount of coverage, and flexibility, you can find the insurance you need for your cryptocurrency and NFTs. Given that cryptocurrency markets can be extremely erratic, keeping your assets safe from external threats, scams, hardware and software failures, and hacking attempts, by ensuring the safety of your cryptocurrency investments, is paramount.