Ledger’s Vault Scores $150 Million in Crypto Insurance From Lloyd’s Syndicate

Ledger, the creator of the iconic Nano hardware wallet, is wooing institutional investors to use its technology to custody cryptocurrency for themselves with the help of big-name insurance broker Marsh. 

Marsh has arranged a $150 million insurance policy from Lloyd’s of London syndicate Arch for users of the startup’s Ledger Vault technology platform, the companies announced Thursday.

The move is another sign that the insurance industry is gradually becoming comfortable writing coverage for digital assets – widely considered a prerequisite for institutional investment.

In the past year, quite a few crypto custodians have trumpeted insurance cover in the hundreds of millions. Unlike those firms, Ledger Vault is not a custodian; rather, it provides tools for investors to store their own crypto. 

“We didn’t have to do this. We are buying insurance for the Vault platform at no additional cost to customers of our platform,” said Demetrios Skalkotos, global head of Ledger Vault.

Ledger’s policy covers third-party theft of private keys in the event of a physical breach of a hardware security module (HSM) in one of its data centers. Also covered is the entirety of the on-boarding process for clients which involves the generation of private keys within the company’s HSMs, as well as collusion within Ledger leading to insider employee theft.

The policy does not, however, cover theft via a third-party remote hack of the type reported fairly regularly at crypto exchanges around the world. The Ledger Vault solution itself is meant to prevent this type of hack by isolating private keys from the internet.

Firms using Ledger Vault set up their own transaction controls and governance procedures. The firm is trying to move away from the frame of reference of online “hot” wallets and offline “cold” ones, calling itself “temperature-agnostic.”

On top of the new insurance policy, Ledger Vault clients will be well-placed to arrange their…

Source Link