In a substantial move that could potentially reshape the crypto mining playing field, Evertas, recognized as the first-ever digital asset insurance entity, has recently acquired Bitsure, a foremost provider for crypto mining insurance. This strategic step aimed to broaden Evertas’ coverage across multiple jurisdictions came hot on the heels of their collaboration with the well-reputed Lloyd’s of London.
A month ago, Evertas and Bitsure unveiled their partnership, dubbing Evertas as Bitsure’s underwriter for crypto mining. Consequently, Arch Insurance International amped up their coverage limits for mining operations, hitting an impressive $200 million. Whereas, previously, Bitsure capped its insurance policy per location at a steady $5 million, with intentions to span over more sections of market operations.
This significant acquisition is speculated to reinforce mining operations and empower other related actors, including exchanges. Especially during these times of instability invoked by the collapse of FTX and the imposition of adverse market forces driving miners towards unfavorable situations.
Interestingly, with this agreement, Bitsure’s co-founder and President Thomas Shewchuk is set to head underwriting at Evertas, aiming to capitalize on Bitsure’s 6% mining cover of the complete Bitcoin network.
One of the unique attributes of digital assets is the challenge inherent in providing them with foolproof insurance coverage. Several observers have indicated that the dearth of comprehensive coverage might be an underlying driver behind certain firm collapses and stunted growth as most executives are devoid of the support they seek.
However, Evertas’ Chief Executive J. Gdanski elucidated on the intricacies embedded in the process of crypto mining insurance. The value of the equipment, along with the profitability, is significantly altered by factors such as mining difficulties. In this light, when more miners enter the fray, overall rewards are depleted, leading to reduced income. Consequently, the resulting necessity of selling assets at discounted prices could leave both miners and insurers in compromising positions.
On an optimistic note, it’s expected that a harmonious integration of miners and insurance entities could help miners weather bearish markets without needing to sell off their Bitcoin reserves or halt operations. Yet, in the middle of all this, the real question lurks in the background – are insurers ready to embrace the unpredictable turmoil of crypto markets? Time will tell.
Source: Cryptonews
