March 29, 2024

Investing in any stock, commodity, securities or cryptos can be a risky affair. While the traditional investors who invest in stocks market or the equity market are protected against any time of scam, or market malpractice through various regulatory authorities such as the FCA or SEC etc., cryptocurrency investors, on the other hand, are deprived of this privilege.

With cryptocurrency largely being an unregulated market, investors are at a risk of losing money due to volatility or scams, or hacking. An absence of a regulatory authority means that in case an investor loses his money, the crypto companies as of now are not liable to cover these loses. This has often left investors urging for the need for crypto regulations or crypto insurance to protect themselves against the losses.

In fact, according to a Chainalysis report titled 2022 Crypto Crime Report, the crypto crimes in 2021 accounted for US$14 billion. Digital wallet scams increased by 80% from a year earlier. The illicit activities included scams on darknet markets and through various ransomware.

Also read: Is Bitcoin losing market dominance good news for investors?

Growing need for crypto insurance

Given the unpredictability of the market, there is a growing need for cryptocurrency insurance by the market participants. The concept of crypto insurance is still in its nascent stage and even the limited one that is present doesn’t cover all the aspects of insurance. Most of big insurance players are not keen…

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