Bitcoin Insurance? The Emerging Market For Digital Asset Insurance

Abstract

Technologists have argued that cryptocurrencies and blockchains will revolutionize our lives. Many have suggested that blockchain is the single biggest technological innovation since the internet itself. It will “democratize finance” and “disintermediate big tech” among other societal improvements. Yet adoption of blockchain has been underwhelming, and it has largely failed to live up to these lofty expectations. One significant reason for this is that the digital assets that underpin blockchains such as Bitcoin and Ether are often not secure, as the industry has been rife with hacks and scams. The emerging market for Digital Asset Insurance may provide the necessary backstop to make the asset safe enough for broader adoption. This article provides an overview of the relevant technology, outlines the state of the digital asset insurance industry, and discusses how the insurance integral to the broader blockchain ecosystem.