BitGo Expands Cold Storage Insurance Program by $600 Million
2 min read
Digital asset custody firm BitGo is making big moves again with their announcement of a $600 million addition to their cold storage insurance program.
BitGo added another level of security for clients with the announcement of over a half-million dollars being added to their cold storage insurance. Last year, the digital asset custodian became the first to offer users the option to buy dedicated excess limits of $100 million. With today’s announcement, they have become head of the class in terms of the largest cold storage Specie program.
BitGo is part of an exclusive group of companies to successfully secure insurance for digital assets, as their CEO, Mike Belshe, points out:
“BitGo was one of the first service providers to build a strong insurance program for crypto. Today, due to BitGo’s technology and scale, we’re able to offer a lower cost Dedicated Customer insurance program on top of BitGo’s secure cold storage system. This milestone demonstrates that the offering has been very popular with clients seeking the ultimate secure and insured storage.”
Unfortunately, bearer instruments, such as BTC, are vulnerable to theft or loss at any number of points during the transfer. Crypto insurance hedges against such losses. It provides a significant level of protection for a user’s digital assets.
BitGo plays a critical role for WBTC
The Paolo Alto-based company plays a vital role as the sole custodian for the operations of Wrapped BTC (WBTC).
Wrapped BTC, or WBTC, is essentially an ERC20 token with the value of one BTC. It enables the transfer of WBTC quicker than BTC and the integration into ETH wallets and smart contracts. It is the representation of BTC on the ETH blockchain.
WBTC is a joint project by BitGo, Kyber Network, and Republic Protocol to enable new application use cases for BTC. The goal is to standardize bitcoins according to ERC20 and to serve as a 1:1 pegged coin.
Despite being the largest, wrapped BTC is not the only venture that brings BTC into the ETH network. A similar project named imToken has also brought its ERC20 token to market titled imBTC, representing BTC. The future success of WBTC and similar projects is directly tied to what developers end up building with them. The permission-less nature of ERC20 tokens allows them to be another cog in the wheel that is DeFi applications. A good example of this would be TokenSets which allows auto trade between ETH and WBTC to bring the best of both worlds together.
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