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Option A पैसा Option B कपड़े Option C शरीर Option D परसInsurance for Bitcoin 2 Facts Startups Need to Know
Insurance for Bitcoin 2 Facts Startups Need to Know is essential knowledge for any emergent company dealing with cryptocurrencies. Understanding these two foundational facts can elevate your risk management strategy and safeguard your digital assets.
Fact 1: Coverage Depends on Custodial versus Non-Custodial Storage
One of the most critical facts startups must know is that insurance for Bitcoin varies greatly depending on whether holdings are stored in custodial or non-custodial wallets. If your startup uses a custodial service (like a crypto exchange or a third-party custodian), the company providing the service may offer insurance—but this coverage typically only applies to specific threats, such as theft or hacking. Always verify the scope of coverage, including limits, deductibles, and exclusions related to cyberattacks, employee misconduct, or internal fraud.
In contrast, if you maintain a non-custodial wallet, such as hardware wallets or self-managed cold storage, there is no third-party insurance automatically in place. Startups using this method must either proactively purchase specialized cyber insurance or create internal controls for multi-signature access and secure private key management to mitigate risk effectively.
Fact 2: Policies Often Exclude Several Key Risks
Even with insurance, many policies have exclusions that startups might overlook. It's vital to understand that typical insurance for Bitcoin may exclude:
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Smart contract exploits or protocol vulnerabilities
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Regulatory changes or government seizure
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Operational errors or loss of private keys
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Social engineering or phishing attacks not prosecuted as criminal acts
Startups should work closely with insurers that offer tailored crypto-asset insurance. A strong policy will disclaim fewer exclusions and may include optional add-on coverages for:
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Theft due to employee collusion
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Custodial provider failure
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Incident response and legal support
Why These Two Facts Matter for Startups
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Financial Protection: Knowing what your insurance does—and doesn’t—cover helps avoid surprise losses in the event of a breach or operational failure.
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Investor Confidence: Clear insurance coverage for your Bitcoin holdings sends a message that your startup is well-prepared and professional, which is attractive to VCs and stakeholders.
How to Strengthen Your Insurance Strategy
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Audit Your Storage MethodsClearly define whether assets are held custodially or non-custodially and assess the associated risks.
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Compare Insurance ProvidersSeek insurers specializing in digital assets. Evaluate policies carefully, focusing on premiums, coverage limits, gaps, and claim support.
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Complement with Security Best PracticesImplement multi-signature wallets, separation of duties, offline backups, and robust operational security to reduce dependency on insurance alone.
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Review RegularlyAs your startup scales or the market evolves, revisit your policy to ensure it aligns with new threats and asset volumes.
