To me, this is a really big step in the legalization and securing of the crypto industry. Now CEXs have more options for buying insurance for assets stored in their cold wallets, making the process of protecting user assets more effective. This may only be the first step, other insurance companies will also soon approach and provide the best services for the market, helping to increase trust and pave the way for wider adoption of crypto. I am a CEX user, I love the convenience, features and high liquidity that CEXs can provide. I am currently using Binance so I am waiting for Binance to participate in this insurance product. I would like to know your views on crypto custody insurance...
You are right, in the past as the cryptocurrency industry was not yet maturing, insurance companies are wary of the risks associated with platforms playing in this field hence they were then so reluctant to deal with it and establish a program tailored to it...but this is now changing most especially in the face of the recent approval of ETFs because that is telling insurance companies that the crypto industry has already arrived and is now recognized as a very legit and lucrative one. Now, this can just be the beginning of many more insurance firms offering financial protection to clients doing business in crypto and this can be a very big news.
1. Is insurance really important for CEXs and the crypto market?Considering the many risks associated with cryptocurrency and the constant threat of hacking especially from North Korean agents, an insured CEX or any other platforms would mean peace of mind to its users and it would elevate the branding of the insured as they can claim that users can experience safety with their funds. This can mean that more and more people would be venturing into the crypto business resulting into the industry definitely coming to the mainstream.
2. Would you trust CEXs more if they used crypto insurance services?Of course, I would. Now, I m expecting that soon insurance policy would be the normal and can even be required by SEC for CEX to continue doing business as this can surely lessen the risks borne by the investing public. Had there been a good insurance policy drawn by FTX then its thousands of users will not be losing a lot of money and their trust of the crypto industry will not have been squashed. There is a great need for insurance in this sector and we need it ASAP!
3. Which CEX will be on board soonest to insure their users' assets?I am sure that top crypto exchanges like Binance, Kucoin, Biget, Bybit, OKX, Coinbase and many more would love to avail of a tailored insurance policy that they can depend on in times of trouble. And since these players are making good money, they won't have a problem paying their premiums...and ordinary users like you and me are guaranteed help in case something will go wrong.