Topic: Are there any companys offering insurance policys for crypto exchanges ? (Read 388 times)

You said it, you said it!!

People worry so much about salaries and expenses, they worry how much they can earn, how much their bank account can grow, but so little do they care about keeping that money safe as a self responsibility.

But can't blame them, we are brought up in society that tells you your government is good. Your banks take care of you. Companies care about you. All of them use us and control us with money.

Time to take charge!!

That is right, people caring about their money is the ideal and not the reality we face right now, however I will admit that I do not really understand people at all when it comes to that lack of concern for their own money and their financial future.

And this is because people spend a great deal of their lives preparing for getting a good job and working for money, so it would make all the sense in the world that people were extremely careful with how they used their money and they took care of it, and yet we see the opposite and I find that to be baffling.

You can not secure your money on the crypto exchanges, Centralized exchanges are highly risk to store your crypto, Because if you don't have the keys, you don't have control over the money. Binance have insurance policy likes SAFU if your money hacked in their exchange then your fund will automatically recovered.

Some exchanges may accept insurance policies If you want to buy insurance policies in crypto, you can choose to accept them by shortlisting some of the popular exchanges. There are various insurance companies why would you want to insure a crypto exchange instead of insuring them. I don't see much of a difference between depositing money into a crypto exchange and insuring that exchange. It would be better for you to insure with the popular insurance companies in your country. When you insure with a physical insurance company, they provide you with various benefits that are usually not available from the scripto exchange.

Correction. We are the only ones who should care about our money. But we have all been brought up to think money is not our final responsibility. Hence we rely on banks. We rely on our countries. All we do is care to rely on promises.

Then when it hits the fan we care to cry.

The problem is teaching people to care. That's the hard shit nobody wants.

The operational license isn't enough to protect users' money or guarantee a refund (depending on how the court decides), it is only limited to supervision and legal action against the exchange. For example, in the case of Mt.Gox, if the hacker isn't revealed until now and the thousands of stolen bitcoins can't be accessed, then the settlement to creditors will remain pending indefinitely.
With insurance, you have your own way of resolving cases like that. What is clear is that the funds returned don't come from "lost" money.

What does this mean though? If the CEX that I use has an operational license in Country A and I live in Country B, I would be part of the asset protection if there is one in the CEX that I use right? Or it's a matter of jurisdiction and like you've said I have to get my own legal representation to have my own crypto insurance? This kind of legal and insurance or asset protection maze that CEX creates is the reason why I don't have my bitcoins in any of them, I'm better off having to lose my bitcoins and crypto out of my own carelessness rather than them having my bitcoins and other crypto on their custody with the possibility of them shutting down and taking everything they have there with them at their departure.

Which means that as we have always known that we are the only ones that really care about our coins, and it is because of this that we need to be the ones to store them and to protect them and trying to find someone else to do it for us is just a waste of time.

However I do not really expect people that do not understand the nature of this market to get it, so they will keep looking for an insurance company to be dumb enough to offer this.

What do you mean by fiat part? Does it mean we should convert our cryptos into the fiat currencies listed there first? I think only few will do this unless if you can also get an incentive for doing this because most exchange users are just traders and once they are done trading, they can be able to pull out their money after, only to be safe.

If someone wants to hold or invest, they already know that doing it on exchange is a worse way. We already know about that condition of insurances. A personal problem or action is obviously not qualified but that should teach that user to be more careful next time of the actions that they are doing.

Don't be too confident and don't put all your assets into CEX,
a private wallet with full control is better than any wallet.

All security also depends on how the user's activity is.
Some of the offers about SAFU were applied to the major exchanges that I mentioned because of the impact of FTX that made many users lose,
and SAFU was the right step that was implemented for the first time by Binance.
Binance has the largest SAFU Balance and that's because Binance users are also more numerous.

In addition to the exchanges mentioned, there may be several other exchanges that start implementing SAFU,
this will be a new era of exchanges, but you still have to be careful with the assets you have.

I didn't know that other exchanges already follow the SAFU program of binance. But I know long time about binance.
This is why I am confident using this trading platform. Maybe, I am using this exchange that's why I am more familiar with their offerings to their users.
Now, that other exchanges have the same feature, I believe more traders will be confident in using those platforms.
With such protection fund, hacking or any unexpected situations will give hope to its traders that they can get their funds back.

Binance is a pioneer in the emergence of the Secure Asset Fund for Users (SAFU),
and it has succeeded in making everyone more confident in the safety of their assets from unfortunate events.

Seeing Binance's success with SAFU, other major exchanges such as OKX, HUOBI, Coinbase, Bitget, and Gate.io launched their own SAFU.

SAFU Exchange fund amount
Binance SAFU: $1B
OKX Risk Shield: $700 M
Huobi Security Reserve Fund: 20,000 BTC
Bitget Protection Fund: $300 M
Gate SAFU: $100 M
Coinbase Insurance: £150 (Protection for UK Customer Account)

For more details on the terms and conditions, please read the Terms and services of each Exchange.

that's what many people who think about keeping their crypto assets safe in the long term or at least according to their investment plans.
However, the guarantee provided by the exchange seems to invite their members who invest to keep it on the exchange as an assumption that they are protecting their assets well and safely.

However, when assets are on the exchange, it means we hand over control of all our assets to the exchange. Therefore, people who don't like things like that will store their assets in hardware wallets and that is the best advice rather than thinking about the protection or insurance that exchanges provide to their members.

If we want to hold crypto currency for a long time, we can definitely keep it but we need a reliable wallet. I myself keep some Kipto currencies in my hardware wallet and my Kip currencies are very safe. So I would definitely suggest you to keep your crypto currencies in hardware wallet.  This will keep your crypto currencies safe.

If you put money in an exchange, especially if it is a centralized platform, you should immediately be aware that the only thing guaranteed is fiat currency, excluding crypto assets, if you ever buy anything from them like Bitcoin, Ethereum, and so on.

Now, as for Dex, I don't know yet, but of course it seems to be the same as CEX in that they can only guarantee fiat. But also try to do some research before you actually take a step towards what you want to happen.

So few people actually answered the question I'm really surprised by this forum sometimes.

I see many people talk bout exchanges with insurance policy. Lets say Coinbase. The biggest. It estimated in 2023 it held over 5 billion in customer funds. But the insurance it has only covers 200+ million. Not even 5%!

So think, if insurer is only willing to cover less than 5% of Coinbase, why would they cover personal insurance?

Then, most important, even with regular fiat, most insurers will only do custom insurance with you for large amounts of money, so OP most likely won't find anyone. But talk especially with smaller insurance providers. You can be surprised what custom ones allow but be prepared for High premium. So high your insurance cost will see you in loss.

I looked into this years ago and what I found was that there are some bitcoin exchanges which do have insurance however it turns out the insurance is only for the fiat part of the exchange and not the crypto side.

So if there was some insider theft, then perhaps it would apply however it won’t apply to individual accounts if someone gets their password leaked or sim swapped. Those definitely aren’t covered.

As far as I know, some of the popular centralized crypto exchange platforms have their own regulations regarding insurance for their platforms. These popular platforms claim that they have insurance for their cold wallets which will back up when there is a hacking problem or various other things which cause losses to the platform and users.
Well, if you want to find a secure place to store your crypto assets, you can try using a custodial wallet which is much more secure than what is offered by exchange platforms.

People learn from their mistakes, but this is a situation where one mistake could lead to you losing everything. As you mentioned, by the time you realize it, it is already too late. There's no doubt that we can make back what we lose, but the damage is already done. I have heard many cases where big investors keep their money in a centralized platform, but that doesn't mean that it is everything that they own. They must have something in their self-custody in case something happens to that asset kept in the Centralized platform.

Whatever others do, doesn't mean that you should follow them or do the same thing. They have more to lose than you. Again, your privacy is for you to keep safe. Let others do it. Most we can do is share the knowledge about why it is bad. Then it's the personal choice whether they wish to follow it or not. They will learn from their mistakes eventually.

I don't know if any exchange will give you insurance facility because I don't use such exchanges. But Binance will give you hacking guarantee if your funds are somehow hacked without your knowledge even if you set enough security from this exchange. then Binance will compensate you for it.  Because they think and believe that their platform has enough security measures. I don't know if any other exchange offers such a facility. Crypto is a risky thing here you have to accept the risk to invest.  So you will not get the insurance benefits like keeping money in the bank here.  But don't always keep crypto in exchange use a non-custodial wallet or hardware wallet it will give you a lot of security and here only you can control your crypto no one else can control your crypto

I have been involved in the crypto world and until now, it seems that I have not found any (Insurance) that collaborates with crypto exchanges or anything related to crypto assets owned by each individual.

For this reason, we often see warnings that are always written on every stock exchange.
For example:

Based on this warning, I don't think any company wants to take the risk of losing crypto assets owned by users.

As far as we know, insurance has several documents that must be prepared by users so that they can be disbursed, such as identity, chronology of physical losses and so on for the disbursement process, such as life insurance, health and so on, exchanges are online, so there is no physical action that can guarantee insurance for disbursement of funds against crypto.

Im agreeing with this!

If there would be some insurances that would exist which includes exchanges then for sure it would really be that an expensive one. Why? potential loss or hacks or whatever issues about on exchange in terms of their funds does really have that lots of problems or holes which we dont really looks good or in favor with insurances which it would really be that common sense that there would really be no one will
really be having that kind of consideration on having exchangers to be included into their services or options. Risks is high and not something that worth even if they would be askign for some
premium on year to year basis. Exchange hack is really that very common and we do know that it doesnt really only talk about a few hundred thousands of dollars but millions.
Damage would really be something that could break someones business  or blown it away in an instant. 

This is why we cant really be able to see some insurance policys for exchange platform yet it is something a business which is really just that too risky on having one.
This is why we do really see that they would really be making their own exchange reserved funds incase problems do exist.

Basically what we have now are a bunch of people that are interested in obtaining profits out of this market but that are not interested at all on the reasons for the market to exist at all.

I could understand investors having this mentality in almost any market except this one, since we are supposed to keep custody of our coins precisely so we can avoid depending on a centralized entity, and yet we have more and more people doing exactly that, and there have been many instances in which those people have regretted their actions as they lost everything when the exchange in which they had their coins stored disappeared, but at that point there is no use at all for their regret.

I wasnt aware on how that SAFU funds do works but since its mentioned then seeing those numbers and probabilities do really sucks. Its been told every now and then that its never been ideal on storing up your
coins on a centralized platform or simply CEX or something that you dont possess the keys of such wallet. Once they would be experiencing some issues then it would really be definitely over for your funds.
You would really be getting it back but only on small partial on which basing up on that example above then that would really be considered to be a huge loss.

This is why i did make out such allocations or division when it comes to my funds on which that long term holds would be stored up on hardware wallet and the short term ones are really that
parked inside the exchange on which im doing trading on which it wont really be that necessary on storing those coins on HW considering about the effeciency of sudden trades
which we know that time would really be that crucial and we do know on how to take those opportunities suddenly.

Always remember, Not your key, not your coins. Don't fall for centralized exchange platform offering some juicy insurance for your assets. As far as I know, those platform that are listed on the top does not provide any kind of insurance for your assets kept in their platform. They provide other services but not this one. You are on your own with this. There have been many incidents regarding hacking or bankruptcy but none of them were providing any kind of insurance.

This is why everyone will advise you to not keep your asset in centralized platforms. The amount they show on the platform are merely numbers but not actual assets. You have no control over your own asset when you keep it on a centralized platform. Your privacy is for you to keep secure. This is why you should keep your assets in self-custody. That is the best way to secure your privacy as well as your assets. Don't make the mistake of keeping your assets in centralized platform.

So when I have $7000 in total assets and a hack happens, then I can only get $100?
That would still be a bad story, going from thousands of dollars to hundreds of dollars and not even enough to build and grow my finances back.

I am also a user of Binance and some other exchanges, but the main exchange is Binance for trading.
But if the percentage of SAFU given will be that bad, it will not give a good enough return.

Storing in Hardwallet is the best for personal management and it is also the sole responsibility of the user.
there is no insurance policy, no guarantee, and no third party.

I do not think that something like what you want exists, not only we are talking about assets which experience a high degree of volatility, especially since you did not specifically said you are talking about bitcoin since you talked about crypto, which makes me believe you want to insure your altcoins, but you also want to insure coins that are not even in your possession.

So I doubt there is any insurance company crazy enough to do this, and if it exist you can be sure you will be charged a fortune for this service.

There have been talks about this. So if you're able to find a working company, it's likely that you're one of the early adopters. Being an early adopter is typically a gutsy move since there is little past experiences to based on + companies are likely to add/remove clauses over time.

For now, I believe not using the exchange as a means of storage and sticking to reputable exchanges for significant amounts are still a good way to mitigate risk.

It's still different that you control your crypto assets rather than others, dude. And since it is inevitable to enter money into the exchange, you should only put in a sufficient amount of money and not store too much money in it.

Just be careful with the exchange you trust to leave your crypto assets. Besides that, you should always be prepared for anything that happens; you know what that means.

If you aren't trading most of your crypto then just bought a hardware wallet and keep your crypto there rather than trusting an exchange because they have an insurance policy/ies. As what others suggested here or stated you won't get a full refund even if they do have something to get it back, imagine the hard earned money and you'll just risk it by staying it on an exchange. If you really want to hold your crypt, buy a hardware wallet.

There's none for sure, if there's one then it would be hella of expensive. Why? We do know that exchange platforms turns out to be like honeypot for scammers. If there's one then i had might be able to miss
out but just like on what i had said that it is something that would really be that impossible or unlikely. This isnt something an information that would really be shared out, not unless if its announced.
This is why its really that important as a trader on which you shouldnt really be that storing up your coins on an exchange platform or centralized so  that you wont really be having that kind of risks on losing with those funds.

We've seen some exchangers had been hacked and ended up on not to be operational anymore or completely stop, and there are situations which  exchange owners do ran off the money of their traders.
There's so much possibilities for you to lose up money if you arent that careful, this is why HW or storing up your coins on non-custodial wallet would be always that recommendable.
Somewhat it do understand on why people do really love on leaving out their coins on exchange to make those fast executions of buys and sells if ever there's an opportunity.

thats what i am searching for

Some good site have their own insurance to cover any losses if there’s a hack but if you are asking for a personal insurance that can cover your money if there’s something bad happen, I guess no services yet for this but this is actually a good idea. Though even on bank, you can’t take any insurance to protect your money in the bank, aside from the government insurance that can give you protection for just a small portion of your money in the bank.

It’s always better to go for trusted crypto exchanges. If you run after exchanges that provides exciting offers but their security is poor, then no one can help you from getting hacked. There are also many trusted exchanges, who provide insurance upto a fixed amount if your funds are in the form of fiat money. So you can have a research on that also. But if you are planning to store your coins in any of the exchanges, then let me say you that it’s a bad idea. In exchanges you completely don’t own the coins. Move it instantly to any cold wallet for better protection.

Even if the exchange offers insurance, you won't be able to get the whole amount of assets. This will be like the FDIC which the amount offered is $250,000 regardless of how much millions you have.

The best thing to do is just take them out from exchanges and send them back if you want to trade again or sell in the bull market. There is no safer way than to keep your coins in your wallet.

This is mostly provided by insurance crypto companies insuring exchanges so in case of hack or bankruptcy. I think you will need to read the team of service of the cryptocurrency exchange you are using so that you can be rest assured that your funds are protected in case of hack of bankruptcy. Many of the big cryptocurrency exchanges do have insurance policies supported by their insurance companies. I think exchanges like Binance, Kraken, Crypto.com etc have something like insurance funds for there customers so in case of bankruptcy.

The only place you can secure your crypto money is your personal wallet, thinking that an exchange will bail you out if something happens in the future is another mistake that will cost you losing everything to an exchange. If you have coins on exchanges, it's better you take them out because that is not how self custody work, you can wake up one day and find out you have nothing under you anymore because you don't have the private keys and when you have no keys, you don't control such assets and if they chose not to pay back, you can't do nothing but to beg to have access to your one crypto.

You remember what happen to FTX, how the exchange went from being one the most to been one with nothing because the team were disorganized, some stole assets through back door that till today, nothing has been recovered from them, and crypto doesn't have any insurance that cover this company.

If you are insurance company, you will not accept to run insurance for any crypto companies because that's one of the biggest and riskiest investment any company will want to insurance. Even if they received money for insurance, the day it might want to collapsed, you will need more to settle this company. Some may even played dirty just to have money from insurance company, nothing safe about insurance here.

Secure Asset Fund for Users (SAFU) has these reserves:

 - https://blockchair.com/bitcoin/address/1BAuq7Vho2CEkVkUxbfU26LhwQjbCmWQkD ----> 565 M USD
 - https://etherscan.io/address/0x4B16c5dE96EB2117bBE5fd171E4d203624B014aa  ----> 99 M USD
 - https://bscscan.com/address/0x4B16c5dE96EB2117bBE5fd171E4d203624B014aa  ----> 313 M USD

Almost a billion dollars, and a third of these reserves are in the form of BNB Balance, which may be zero if binance collapses.

according to ----> https://coinmarketcap.com/exchanges/binance/ Spot Trading Volume(24h) was 7 B USD and Total assets was 70 B USD meaning that SAFU represents about 1/7th of the daily trading volume and 1/70 of Total assets.
the chance of getting your money back seems to be one dollar in every seventy dollars at best.

If it's the exchange itself, there are for sure insurance companies that they're securing their funds in terms of hacking incidents.

But as an individual, I don't think that there's one service that gets a policy from an insurance company to secure your funds sleeping on an exchange.

The best insurance is that if you're not going to trade, don't keep your funds in any exchange.

If you are in some countries that require cryptocurrency exchanges to make an emergency fund in the event of bankruptcy, you may be able to recover part of your money, but this process is slow and may take several months, if not years. So why do you need to secure your money with a third party instead of using a multi-signature wallet in the bank vault or in the bank, where you can place wallet seed in safe place or using services that encrypt part of the private key and enable you to recover your money even if you do not remember the seed, are all safer solutions than leaving your money in an exchange and waiting for compensation to occur if the exchange goes bankrupt or is hacked.

I doubt if you truly want to secure your crypto. Choosing exchange to store your assets over personal wallet where you have your keys and full control of your assets is unwise decision. Regarding your question, the simple answer is Yes, there are a few exchanges that offer insurance for their users in case of a hack or bankruptcy but not all exchanges offer insurance for their users, so you should take your time to do your research before choosing an exchange. Don't lose guard with insurance mentality, you should also consider factors like fees, security features (very important) and customer support. It's also worth noting that these insurance policies usually have limits and don't cover all types of losses, so you should try to read the fine print.

Still nothing because the one who control the funds for insurance is the exchange who running the business so if they turn scam for sure that they can't recover anything including the insurance money that they supposed to get. That's why we should always think that the word Not your keys not your coins is always valid to think about. Maybe the only we can do with them is not to put a huge money then hodl it on their exchange or other so that we will not get any problem if the same like FTX issue will happen.

But that is binance they are strong so hopefully they will not follow the foot tracks of FTX since if they turn scam for sure there's huge effect on crypto market, also it might get a impression that there's no legit business running using crypto.

Yeah see this but this does mean that they got a tight insurance privilege to users or just a fund in case theres a hack or breach on their exchange and got some loss on the users. But we are talking about insurance like a sure money back guaranteed which differs right? Cause what if the safu funds exceeds the loss so theres anyone who will not be reimburse? What do you think mate?

They can have their Secure Asset Fund for good intention but their exchange is centralized and we can not trust them. It can be used to deceive us and make us more believing in their service. At the end, some exchanges turn to be scam, bankrupted like FTX exchange so it's risky, very risky.

Always remember what has been repeatedly warned to Bitcoin users, investors. Not your keys, not your bitcoins.

Using centralized exchange is already a risk for everyone. But there are some exchanges that have their own emergency fund like Binance called Secure Asset Fund for Users (SAFU)
Where they have their own insurance which comes from a portion of trading fees generated by their exchange.

Since this is still centralized exchange, they are still the one who control it. Still risky.

Reminder: do not keep your money in online accounts.
Be careful with online services.

Exchanges are centralized, online services and like above warnings, you should not store your bitcoin there.

Choose open source, non custodial wallets to use.
Choose your wallet
https://walletscrutiny.com/ for wallet review, deeply technical.

Depending on country and exchange, some exchanges have user's funds insured up to a certain amount. But — take note that most of the time only your fiat deposits are insured, not your crypto.

Best option is still to get your funds out and self custody. Only leave on exchanges the amount you're actively trading, no more no less.

https://NotYourKeys.org

Read "about us" on any exchange. When an operational license is awarded, a centralized exchange is automatically subject to regulation and becomes part of the supervision of the authority where the license was issued. As far as I know, there is no special protection offer for certain customers, you must have legal representation and get your own insurance to cover the risk of loss.

im looking to secure my crypto money on the exchange !  are there any reliable companys offering insurance policy for individuals against bankruptcy ore hack of the exchange ?

thanks