South Korea: Insurers wary of providing coverage for crypto exchanges
Source: Asia Insurance Review | Aug 2018
South Korea Cyber InsurTech
Insurers in South Korea are not very forthcoming in providing insurance for crypto exchanges in the country, despite the country being the nation with the most prolific cryptocurrency users, exchanges and thriving digital assets business. The spate of crypto crimes in exchanges appears to have pushed insurance companies onto the back foot, according to a report on ZyCrypto, a cryptocurrency website.
Lack of security in exchanges
The main drawback for these high-risk covering insurance companies has been the continued lack of comprehensive security measures in these exchanges.
The largest crypto exchange heists have been $530m Japanese tokens from Coincheck Exchange. In South Korea, on 10 June, Coinrail reported $40m and on Bithumb a DDoS attack stole $32m from that exchange’s wallets despite claims of the exchange storing it in cold wallets.
According to the South Korean Blockchain Association, insurers are suggesting that the exchanges have to build a stronger control system and ensure security.
The small numbers of exchanges which have insurance coverage have low liability limits, ranging from $2.5m to $5.2m. A