Insurance on cryptocurrency holdings? might be hard to find a provider that would accept that level of risk and volatility.
Would the premiums increase with the value of the BTC?
What if there just isn't enough bitcoin in circulation to cover the loss (there is a 21 million cap on BTC).
Bank robberies don't usually leave the bank with nothing :-)
Exchange gets rolled, it might not even afford the claim.
Agree about advantage as being a great place to work vs traditional banks. They will attract better talent for sure.
> What if there just isn't enough bitcoin in circulation to cover the loss (there is a 21 million cap on BTC).
It's being defacto established that when a cryptobank gets robbed, the funds are repaid to customers using local currency, not BTC, priced at the time of the loss.
So, from the underwriter's perspective, it's just insuring whatever total USD value Coinbase currently holds, with consideration given to Coinbase's ability to prevent theft. Not any different from a bank insuring itself against loss due to cybertheft.
What if there just isn't enough bitcoin in circulation to cover the loss (there is a 21 million cap on BTC).
Bank robberies don't usually leave the bank with nothing :-) Exchange gets rolled, it might not even afford the claim.
Agree about advantage as being a great place to work vs traditional banks. They will attract better talent for sure.