1 September 2014Asset management analysis

Bitcoins safe with Bermuda captive

Bitcoin wallet firm Xapo is insuring users’ crypto-currency through a Bermuda-domiciled captive, the company has confirmed.

Xapo subsidiary Meridian Global Insurance, managed by Willis, insures the Xapo Vault against hacking, theft by an employee, a break-in at the physical vault, and bankruptcy, at no extra cost to users.

In a statement, it said: “Xapo formed Meridian to add an extra layer of protection for our customers and their bitcoins.”

“By putting our money and bitcoins into a separate insurance entity, Meridian provides protection against certain events that may happen to Xapo. This would not be the case if we simply kept our assets within Xapo and self-insured the Vault.”

Xapo’s decision to insure its users crypto-currency follows the bankruptcy of Mt. Gox in February, which cited debts of $64 million and misplaced almost one million bitcoins.