Cryptocurrencies are growing in value as these assets are becoming more popular around the world. Bitcoin, the leading cryptocurrency, has been on a bullish run for most of the year, and its price has recently started rising again. The rising value of the cryptocurrency has been accompanied by an increasing threat of hacks.
Analysts estimate that the value of crypto assets in existence maybe around $300 billion. This high value makes these assets a target for hackers. Hackers also know that once they acquire cryptocurrency, it is difficult for the digital assets to be traced and recovered, and this makes them even more attractive for them. The obscure nature of cryptocurrency makes it nearly impossible to recover a stolen loot.
Growing demand for insurance
With many countries developing crypto friendly policies and the crypto industry itself growing, there is a need to protect crypto holders and their assets. Two years ago, crypto insurance was virtually nonexistent but now, there is substantial demand for this service. Exchanges and crypto holders are beginning to look at their options as far as getting insurance for their crypto assets goes.
There are companies that have started providing crypto insurance and these firms are reaping significant rewards. Companies such as Lloyd’s of London, Coalition and Aon are some of the providers of crypto insurance that are currently in the market.
Joshua Cotta, CEO of Coalition, said that he thinks that there is currently between $200 million and $500 million worth of revenue from premiums. When one considers that the value of crypto assets in existence is said to be around $300 billion, it is clear that there is still a lot of room for crypto insurance providers to come in and reap the rewards of such a lucrative industry.
Rising value of the cryptocurrency to benefit crypto insurers more
More applications for blockchain technology and cryptocurrency are being developed, and this pushes the value of crypto assets up. The technologies have been available for some years, but they are starting to approach mainstream adoption now.
Geopolitical factors are also playing a part in the rising value of cryptocurrencies. The uncertainty surrounding political situations across the world is affecting money markets, and investors have turned towards cryptocurrencies. Bitcoin is being considered a safe haven asset by investors and the last few months have seen funds being poured into the leading cryptocurrency.
With these factors in play, analysts predict that Bitcoin’s value may reach close to $20,000 by the end of the year. Firms that provide insurance for cryptocurrency will benefit from this rising value of the assets. Many investors are wary of the threat posed by hackers, and they are looking at all the options available as far as protecting their crypto holdings goes.