Marsh establishes new global facility for digital asset custodians

Marsh establishes new global facility for digital asset custodians | Insurance Business Australia

Technology

Marsh establishes new global facility for digital asset custodians

It offers capacity of more than US$800 million

Technology

By
Kenneth Araullo

Marsh has unveiled a new insurance solution designed for custodians of digital assets, including financial institutions.

This new facility offers up to $825 million in insurance coverage to Marsh’s global clientele and is crafted to cater to organizations holding digital assets in cold storage — offline storage — as well as those seeking insurance for risks associated with assets safeguarded through Multi-Party Computation (MPC) or other custody technologies not solely reliant on offline methods.

Supported by Lloyd’s syndicates and London-based international insurers, the facility aims to safeguard organizations’ digital assets from a variety of risks, including natural disasters, physical theft by external parties, and insider threats involving employee collusion. The launch comes at a time when various sectors are keen on establishing their presence in the digital asset custody space, riding the wave of a decade’s growth and maturation within the digital asset market.

Marsh’s 2023 global technology industry risk study indicates that half of the technology industry’s global respondents are either currently involved with or exploring digital asset opportunities. Additionally, 136 banks insured by the Federal Deposit Insurance Corporation in the United States are embarking on or are already engaged in digital currency-related projects.

The new insurance facility is the brainchild of Marsh Specialty’s Digital Asset team, based in New York and London, specializing in offering risk transfer solutions for businesses involved with blockchain, cryptocurrency, and other digital assets.

“With the digital assets space continuing to evolve rapidly, organizations are navigating a complex risk landscape amid an expanding ecosystem of stakeholders,” global digital asset leader at Marsh Specialty Jacqueline Quintal said.

“Our new facility equips custodians with critical protection against the foremost operational risks encountered in digital asset management. We are eager to assist our clients worldwide in matching their risk financing with their commercial strategies, enhancing operational resilience, and solidifying their market position in this burgeoning sector.”

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