Just so everything is clear: Customer funds stored in Coinbase wallets are NOT FDIC-insured; they are held by FDIC-insured banks. This is a huge misnomer they are not exactly stating.
Your CB USD wallet with fiat cash is protected up to $250K (as are all fiat banks meeting the necessary requirements), but your BTC wallet is not. CB is insured privately against hacking and theft, but this coverage does not insure your personal wallet, just their holdings.
This is not an excuse to keep fiat or BTC in your wallets on the exchange. You are not fully protected and in some cases (personal BTC wallets), you are not protected at all.
Topic: Coinbase is Insured (Read 1862 times)
It's just another example of the bitcoin economy maturing and expanding. Nothing unexpected here, although welcomed.
That would be awesome! But I wonder what insurance company they got, after MtGox and lately Bitstamp it seems like a risky business to insure...
From https://support.coinbase.com/customer/portal/articles/1662379-how-is-coinbase-insured-, which is linked from https://exchange.coinbase.com
Quote
Coinbase is insured against employee theft and hacking in an amount that exceeds the average value of online bitcoin it holds at any given time. Specifically, Coinbase's insurance policy would respond in the event that bitcoin stored in Coinbase was lost or stolen as a result of a breach of our physical security, cyber security, or as a result of employee theft.
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
Thats pretty sweet, so does this make coinbase the online wallet of choice now? perhaps safer then cold storage if you struggle technically.
How do you know this? Do you work for Coinbase?
That's irrelevant. It's not important how I know this.Besides, anyone with any intelligence in their head, while running a company, wouldn't do such a thing.
Let's not forget that the banks in Greece were "insured" too. Don't rely on "insurance" to save your ass when everything goes wrong.
Agreed. Insurance only helps protect you against small time crooks and not the really big institutionalized ones. Coinbase fills a niche however for those that are comfortable with this.
It is interesting though, in essence insurance is to cover a loss that can be covered with Fiat, how it will work in practice will be interesting though.
Coinbase gets hacked two scenarios one they buy the bitcoins on the market and compensate the users for the hack, or they return the fiat equivalent of the Bitcoins at the exchange rate (Whether that is the rate that was available at the time of the hack, or the market rate at the time of settlement is not clarified)
I won't say that the insurance is a bad thing though but a clarification of what happens in the unlikely scenario would be helpful to all users, that said I also hope the insurance pays out seeing as its a new product class in a sense.
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This insurance policy does not cover damages resulting from a specific user's loss, such as the losses resulting from a compromise of the user's login credentials. Coinbase's insurance also contains standard policy exclusions (e.x. force majeure). Should information regarding this coverage materially change, we’ll update this and other relevant pages in a timely manner.
A bit too broad a definition for me need a few specifics
Let's not forget that the banks in Greece were "insured" too. Don't rely on "insurance" to save your ass when everything goes wrong.
Agreed. Insurance only helps protect you against small time crooks and not the really big institutionalized ones. Coinbase fills a niche however for those that are comfortable with this.
Let's not forget that the banks in Greece were "insured" too. While it's a nice thing to have, don't rely on "insurance" to save your ass when everything goes wrong. And don't forget that this "insurance" protects coinbase from hacks, but if you are hacked you are not covered. Actually owning your Bitcoin by keeping it in a private key you own is much safer than having an IOU from coinbase.
What's stopping any of the employees from transferring bitcoins to their own personal wallets? Bitcoin is a very risky currency to hold because it can be sent anywhere with no possibility of reversal. I wouldn't rely on that insurance to save me if I had money held on their site.
Because they don't have access to the coins? That's what is stopping them.It's not like you just let everyone in the company have access to all of the company's money?
How do you know this? Do you work for Coinbase?
What's stopping any of the employees from transferring bitcoins to their own personal wallets? Bitcoin is a very risky currency to hold because it can be sent anywhere with no possibility of reversal. I wouldn't rely on that insurance to save me if I had money held on their site.
Because they don't have access to the coins? That's what is stopping them.It's not like you just let everyone in the company have access to all of the company's money?
What's stopping any of the employees from transferring bitcoins to their own personal wallets? Bitcoin is a very risky currency to hold because it can be sent anywhere with no possibility of reversal. I wouldn't rely on that insurance to save me if I had money held on their site.
From https://support.coinbase.com/customer/portal/articles/1662379-how-is-coinbase-insured-, which is linked from https://exchange.coinbase.com
Quote
Coinbase is insured against employee theft and hacking in an amount that exceeds the average value of online bitcoin it holds at any given time. Specifically, Coinbase's insurance policy would respond in the event that bitcoin stored in Coinbase was lost or stolen as a result of a breach of our physical security, cyber security, or as a result of employee theft.
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
The wording of that answer is a bit ambiguous because Coinbase also said they said over 90% of the BTC they hold is in offline storage.
Notice how Coinbase said the "online bitcoin" is insured, but they don't say anything about offline BTC being insured.
The skeptic in me thinks they only have insurance that covers funds in their hot wallet, but I could be wrong...
Don't be this skeptic, relax. Coinbase is the right way to go for now.
From https://support.coinbase.com/customer/portal/articles/1662379-how-is-coinbase-insured-, which is linked from https://exchange.coinbase.com
Quote
Coinbase is insured against employee theft and hacking in an amount that exceeds the average value of online bitcoin it holds at any given time. Specifically, Coinbase's insurance policy would respond in the event that bitcoin stored in Coinbase was lost or stolen as a result of a breach of our physical security, cyber security, or as a result of employee theft.
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
The wording of that answer is a bit ambiguous because Coinbase also said they said over 90% of the BTC they hold is in offline storage.
Notice how Coinbase said the "online bitcoin" is insured, but they don't say anything about offline BTC being insured.
The skeptic in me thinks they only have insurance that covers funds in their hot wallet, but I could be wrong...
BTC is privately insured and USD wallets are insured by FDIC.
https://support.coinbase.com/customer/portal/articles/1780543
https://support.coinbase.com/customer/portal/articles/1780543
From https://support.coinbase.com/customer/portal/articles/1662379-how-is-coinbase-insured-, which is linked from https://exchange.coinbase.com
Quote
Coinbase is insured against employee theft and hacking in an amount that exceeds the average value of online bitcoin it holds at any given time. Specifically, Coinbase's insurance policy would respond in the event that bitcoin stored in Coinbase was lost or stolen as a result of a breach of our physical security, cyber security, or as a result of employee theft.
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
Coinbase has held this insurance since November 2013 with highly rated carriers (S&P rating of A+ or A.M. Best Rating of A XV or higher).
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