Innovation Insurance Group

  • Home
  • About
    • Company Profile
      • Annual Reports
        • 2014 Annual Report
        • 2013 Annual Report
    • Ty R. Sagalow
    • Lisa Vivori
  • Our Services
    • Expert Witness
    • InsurTech
    • Product Development
      • Product Development Case Studies
    • Directors and Officers Insurance
    • Cyber Risk Insurance
    • Bitcoin Insurance Agency
      • BitCoin 101
      • Bitcoins FAQ
      • Bitcoin Video Series
      • Publications and Interviews
  • News
    • Speaking Engagements
    • IIG in the News
    • Bitcoin Industry News
    • Events
    • World Risk and Insurance News
      • Web Series Hosted
        by Ty Sagalow
        • What’s New in Insurance?
        • Innovations in Insurance
      • Interviews of
        Ty Sagalow
    • Gallery
  • Leadership
    • Publications and Interviews
      • Innovation and Product Development
      • D&O Insurance
      • Cyber Risk Insurance
      • Reputation Risk
      • Bitcoin
    • Innovation
    • Emerging Risks
      • InsurTech
      • Reputation Risk
      • Crowdfunding
      • Bitcoin Risk
      • Cyber Risk
    • Thoughts from Industry Leaders
  • Clients
    • Clients
    • Testimonials
    • Partners
      • Advisen, Ltd.
      • Hanover Stone Partners, LLC
      • CLM Advisors
  • Lemonade Book
    • Book Store – Buy the Book
    • Book Overiew
    • Interviews with the Author
    • Book Signing Gallagy
  • Contact Us
You are here: Home / Publications and Interviews / BITGO’S BITCOIN WALLET NOW BACKED BY WORLD-CLASS INSURANCE (Cyptocoins news)

February 25, 2015

BITGO’S BITCOIN WALLET NOW BACKED BY WORLD-CLASS INSURANCE (Cyptocoins news)

FEBRUARY 25, 2015, CYPTOCOIN NEWS

BitGO were the first to pioneer the multi-signaturetransaction back in August, 2013. Now they’re pioneering in security again, with this week’s unveiling of a partnership with one of the largest underwriters in the world, XL Group and the Bitcoin Financial Group.

All users of the hosted wallet service will now be covered up to $250,000 for covered theft claims. Users who require or would like more coverage than that can acquire it at the competitive rate of about 1% per year (in addition to regular monthly fees).

$250,000 Theft Insurance for All BitGO Customers

Insuring Bitcoin deposits has long been one of the holy grails of the industry. The very nature of digital money makes it somewhat more vulnerable to theft and natural disaster, and finding a suitable underwriter willing to cover a Bitcoin company was no easy task, according to BitGO CEO Will O’Brien. (We spoke to him on 23 February in preparation for this article.)

This was a huge effort. We engaged the former chief underwriting officer from AIG, Ty Sagalow – this is a guy who’s pioneered things like Y2K Insurance, cyber insurance, reputation insurance, and others. We partnered with him and his firm to structure these policies. […] We spoke with a number of different underwriters. XL Group was one of the ones who were most forward-thinking and innovative. […] It was a great challenge. It was something that really only somebody in BitGO’s position could accomplish, because we had the track record, we had the team, we had the operational scalability, we had the technical know-how. They vetted our company, they vetted our operations – they wanted to dig deep into Bitcoin technology, multi-sig technology. It was a lot of effort. It’s not something that is easily attainable. And that’s a value-add for our customers.

12-wallet

CCN

The insurance policy now secured by BitGO extends coverage to all account holders up to $250,000. It is important, for legal reasons, to stress that BitGO is not going into the insurance business – rather, they have summited the mountain that is attaining insurance in the wild west of Bitcoin economics. BitGO has long been a good option for Bitcoin start-ups who would rather focus more on their core business than wallet security.

 

 

When you think about the history of Bitcoin storage and Bitcoin transactional systems, in the early days, it was up to the users to set up their own security. If you’re using a desktop wallet, and there are a lot of them out there, you’ve got to make sure that your computer doesn’t have malware on it. If you’re using a hosted service, like an exchange or a web wallet, you’ve got to trust your private keys with that hosted service.

With the advent of multi-sig, it makes it such that there’s no one single point of failure if properly implemented. […] Now a hack can’t result in the loss or theft of funds – in theory. […] There are still customers out there, especially in the large enterprise/institutional space, who are saying, ‘That’s all great, I trust technology, I trust BitGO, but what about additional assurances can I have BitGO standing behind this technology that they’ve implemented?’

The Last Mile for Major Players

Companies that hold funds for their customers will especially be attracted to the protection this new feature of BitGO’s services will add. With the recent failures of the exchanges Bter and BitStamp, customer funds were in limbo. In the second case, BitStamp was able to pay back lost funds. However, in the case of Bter, over 7,000 Bitcoins went missing in the blink of an eye and nobody who lost funds will be re-compensated. Had they been using BitGO’s service, the theft might not have happened in the first place. If it still had, the exchange would have presumably been covered and able to return customer deposits while retaining trust.

12-keys

For many companies still on the fence about whether to engage in the Bitcoin economy or not, having deposits insured was the last mile. A ripple effect may well take place as legacy firms can enter the world of Bitcoin with relative assurance that theft in the form of unauthorized transactions is a thing of the past.

O’Brien urges companies looking to build Bitcoin-integrated services into their business strategy to have a look at their API. For nominal fees, they’ll be sure that their deposits are as safe as they can be.

If you’re building a Bitcoin business today, there’s no reason you should be going and downloading the core Bitcoin libraries like bitcoind, trying to run it yourself, and trying to figure out where to store keys, when you have a service like BitGO, that is battle-tested. We’ve been at this for over two years, and as you scale up what you’re doing, your holdings, your operations, we can keep working with you to give you more and more confidence around the scalability and security of your platform.

Print Friendly, PDF & EmailPrint Friendly
Share

Filed Under: Publications and Interviews

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Innovation Insurance Group, llc

Offices at Short Hills
51 John F. kennedy Parkway,
First Floor West
Short Hills, NJ 07078
917-620-2174 (Ty's cell))
973-261-5624 (office)
contact@innovationinsurancegroup.com
tysagalow@innovationinsurancegroup.com

Expert Witness

Ty Sagalow head shotTy Sagalow's unique background in legal, underwriting, policy drafting and claims – and his designation as a “qualified insurance expert” by the United States District Court for the Southern District of California – offers attorneys an unparalleled resource in D&O, E&O and Cyber insurance coverage disputes. He was also named "Most Helpful Expert" in a recent $8.7M coverage decision.

Mr. Sagalow served as Chief Underwriting Officer and General Counsel for AIG Executive Liability (formerly National Union Fire Insurance Company of Pittsburgh, PA), the world’s largest carrier of Directors and Officers Liability and Professional Liability Insurance. As General Counsel, Mr. Sagalow personally wrote or led teams that wrote all the D&O policies and many of the professional liability policies that AIG produced between 1988 and 2000 – policies which continue to serve as the foundational wording for the D&O and professional liability policies in the market today. As AIG Executive Liability’s Chief Underwriting Officer, Mr. Sagalow was charged with all underwriting interpretations and decisions for AIG D&O/E&O policies. In 2009, Mr. Sagalow headed up the team that rewrote all D&O policies for Zurich North America.

Ty is a cum laude graduate of Georgetown University Law Center and holds a LLM from New York University School of Law.

Company Profile

Innovation Insurance Group is an insurance consulting firm and insurance brokerage founded by 30-year insurance executive, Ty R. Sagalow, former Chief Underwriting Officer, General Counsel and Chief Innovation Officer at AIG, and former Chief Innovation Officer at Zurich, NA and Tower Group. IIG focuses on three core practice groups: product development, expert witness services (primarily in the Management and Professional Liability areas), and bitcoin industry brokerage services.

Learn more about Ty R. Sagalow
Learn more about Innovation Insurance Group
Learn more about InsurTech Consulting
Learn more about Bitcoin Insurance Agency

Innovation Insurance Group, LLC BBB Business Review

Featured Topics

  • InsurTech
  • Innovation and Product Development
  • Directors & Officers Liability Insurance
  • Cyber Risk Insurance
  • Reputation Risk
  • Bitcoin Risk and Insurance
  • Emerging Risks
  • Interviews of Ty Sagalow
  • Gallery
  • Testimonials
  • Speaking Engagements

Featured Video Series

  • "What’s New in Insurance with Ty Sagalow"
  • "Innovations in Insurance hosted by
    Ty Sagalow"

Recent Speaking Events

  • CIIA Conference: Innovation, Culture and Technology
    May 13, 2021, Chili (Virtual)
  • Latin American Conference New Perspectives and Innovations for the Future of Insurance
    Nov 4, 2019, Mendoza, Argentina
  • Reactions North America Re/Insurance Conference
    Sept 26, 2019, New York
  • Global InsuTech Conference
    June 18, 2019, New York
  • InsideTech
    June 13, 2019, New York
  • Latin America Reactions Conference, InsurTech
    May 23 2019, Miami
  • AIMU/MICA Marine Insurance - A Global Perspective: The Future of Insurance
    June 21, 2018, New York
  • 12th Property Innovation Summit: InsureTech and the Lemonade Way of Claims
    May 2, 2018, St. Petersburg, FL
  • Italy Insurance Forum
    April 11, 2018, Milan, Italy
  • FST: The Future of Insurance
    March 6, 2018, Sydney, Australia
  • Artificial Intelligence Conference
    January 29 - 30 - Miami Beach
  • Kennedys leadership summit: What Law Firms Can Learn from InsurTech
    January 20, London
  • All Speaking Engagements
    • 2016 Insurance Consultants Award
      2016 Insurance Consultants Award
    • 2017 Insurance Consultants Award
      2017 Insurance Consultants Award
    • 2017 Insurance Expert Witness of the Year
      2017 Insurance Expert Witness of the Year
    • AI 2017 InsurTech Consultant of the Year Award
      2017 InsurTech Consultant of the Year Award - AI International
    • 2018 Best Advisor Award – M&A Today
      2018 Best Advisor of the Year - M&A Today
    • 2018 Best Consulting Firm – Lawyers International
      2018 Best Consulting Firm - Lawyers International
    • 2018 Best Advisor of the Year - Corporate USA Today
      2018 Best Advisor of the Year - Corporate USA Today
    • 2018 Insuretech Consultant of the Year - Business Excellence
      2018 Insuretech Consultant of the Year - Business Excellence
    • 2019 50th Fasting Growing Company
      2019 50th Fasting Growing Company

    Copyright © 2023 Innovation Insurance Group · Offices at Short Hills · 51 John F. Kennedy Parkway, First Floor West · Short Hills, NJ 07078 | Site Map | Log in