Protecting Crypto Holdings Becoming Mainstream

Insurance underwriters associated with Lloyd’s of London are now backing a new liability policy designed to protect cryptocurrency stored in online wallets. With a modest minimum of 1,000 British pounds ($1,275) in protected assets and rather flexible terms, the product seems to be geared for retail and corporate investors. But who is behind the novel service, and how will the policy work?

Forces behind the innovation

Despite the enthusiasm expressed in early media accounts for “insurance giant Lloyd’s backing crypto,” Lloyd’s of London is not an entity to which any centralized agency can be ascribed. Unlike most other major players in the field, it is not an insurance company, but rather a marketplace where insurance underwriters and brokers meet to assess and pool risks. This corporate body boasts a centuries-long history, with its governance structure codified in the 1871 Lloyd’s Act.

Lloyd’s hosts both individual and corporate underwriters, the latter being referred…