Bitcoin: Risk factors for insurance
This report presents two expert contributions which investigate the key risk factors for the insurance of Bitcoin operations.
Published: 12 June 2015
Key facts:
- Bitcoin offers a lower cost alternative to established banking and money transfer systems
- The particular characteristics of Bitcoin make it an attractive target for cyber attack and therefore, the security risk will never be reduced to zero. The establishment of recognised security standards for Bitcoin storage would greatly assist risk management and the provision of insurance
- It is essential for the long term viability of Bitcoin that it does not become synonymous with crime. The Bitcoin community should co-operate with law enforcement agencies to prevent exploitation by criminal networks
- Insurance can be a key component of responsible risk management to enable the next phase of Bitcoin’s evolution.
Bitcoin: Risk factors for insurance
The report presents expert analysis which concludes that although the technology, procedures and practices that underpin Bitcoin are maturing, concerns remain over security and the potential for criminal exploitation.
12 June 2015
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The report, part of Lloyd’s Innovation Series, does not endorse the insurance of Bitcoin operations but rather contributes to the assessment of these risks for insurance purposes.