NEW YORK, Jan. 16, 2020 /PRNewswire/ -- Gemini Trust Company, LLC (Gemini), a cryptocurrency exchange and custodian, today launched Nakamoto, Ltd. (Nakamoto), a captive insurance company licensed by the Bermuda Monetary Authority (BMA) to insure Gemini Custody™. Nakamoto — the world's first captive to insure crypto custody — allows Gemini Custody™ to increase its insurance capacity beyond the coverage currently available in the commercial insurance market. This insurance solution gives Gemini Custody™ $200 million in insurance coverage — the largest limit of insurance coverage purchased by any crypto custodian in the world.
"Insurance is one of the main barriers to crypto mass adoption," said Cameron Winklevoss, President of Gemini. "Gemini has created a captive insurance company to address this. Obtaining meaningful insurance in the crypto industry remains a challenge, and our captive will help to increase our insurance capacity and move the industry forward."
Gemini Custody™ is regulated by the New York State Department of Financial Services (NYDFS) and is SOC 2 Type 1 compliant. Separate from Gemini Custody™, Gemini also offers insurance for customers' crypto held in its online Hot Wallet. U.S. dollar customer deposits are eligible for FDIC "pass through" deposit insurance.
"Currently, the crypto industry lacks insurance coverage similar to that available in traditional financial markets," said Yusuf Hussain, Head of Risk of Gemini. "Gemini recognized this gap and collaborated with two of the world's largest insurance brokers, Aon and Marsh, to solve for this."
Gemini worked with Aon to incorporate Nakamoto in Bermuda, the world's leading captive insurance jurisdiction. With Aon as Nakamoto's captive manager, Gemini will be able to tap into broader insurance markets, including the reinsurance markets, to obtain access to greater amounts of insurance capacity at optimal costs. By doing so, Gemini can pass the savings to customers, scaling customers' insurance needs as the crypto industry grows.
Additionally, Marsh's Digital Asset Risk Transfer (DART) team brokered excess insurance from the commercial insurance markets to provide a robust custody insurance solution. Gemini was able to demonstrate a secure, compliant, and regulated custody offering, providing insurers the confidence to underwrite a substantive amount of insurance for Gemini Custody™.
In addition to the coverage provided by its custody insurance solution, Gemini customers can now purchase additional insurance for their segregated crypto assets to provide even greater coverage.
About Gemini Trust Company, LLC:
Gemini Trust Company, LLC (Gemini) is a cryptocurrency exchange and custodian that allows customers to buy, sell, and store cryptocurrencies like bitcoin, bitcoin cash, ether, litecoin, and Zcash. Gemini is a New York trust company that is subject to the capital reserve requirements, cybersecurity requirements, and banking compliance standards set forth by the New York State Department of Financial Services and the New York Banking Law. Gemini was founded in 2014 by twin brothers Cameron and Tyler Winklevoss to empower the individual through crypto.