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Coinbase's insurance is limited to say the least. Namely, it only covers losses from hot storage (<2% of holdings) and it doesn't cover losses due to compromise

Coinbase's insurance is limited to say the least. Namely, it only covers losses from hot storage (<2% of holdings) and it doesn't cover losses due to compromises of an individual account. > Coinbase prioritizes the security of our customer's digital currency through a combination of online “hot storage” and offline “cold” storage. Coinbase maintains 98% or more of customer digital currency in cold storage, with the remainder in secure hot servers as necessary to serve the liquidity needs of our customers. All digital currency that Coinbase holds in its online hot storage is insured. If Coinbase were to suffer a breach of its online hot storage, the insurance policy would pay out to cover any customer funds lost as a result. > This insurance policy does not cover any losses resulting from the compromise of your individual Coinbase account. Please note that the insurance policy covers any losses from Coinbase’s hot storage resulting from a breach of Coinbase's physical security, cyber security, or by employee theft. It is your responsibility to use a strong password and maintain control of all login credentials you use to access Coinbase. https://help.coinbase.com/en/coinbase/other-topics/legal-policies/how-is-coinbase-insured https://help.coinbase.com/en/coinbase/other-topics/legal-pol...

htormey 6y ago
Just a reminder that Coinbase custody is a different product to the app you install from the App Store. The faq you posted I believe refers to the latter. If you are a large institutional investor you would likely use this and not a normal coinbase account. I don’t work on custody but they may have a different insurance policy and or do things on a case by case basis: http://custody.coinbase.com/faq http://custody.coinbase.com/faq “ What storage systems does your insurance cover? - Coinbase’s policy covers all storage methods. This includes hot, warm and cold storage. Read more about our insurance policy here or ask the Custody team for more information.” If you are interested in learning more here is a good article on insurance and cryptocurrency: https://blog.coinbase.com/on-insurance-and-cryptocurrency-d6db86ba40bd https://blog.coinbase.com/on-insurance-and-cryptocurrency-d6...
- kevindong 6y ago
  Huh TIL Coinbase has a product for large investors. Regardless per that FAQ page you linked: > We carry an annually renewed commercial crime policy that carries a $255m limit (per-incident and overall), with Coinbase Global as the named insured. So in the event of a security breach, it's probable that losses would exceed the insured amount.

htormey 6y ago

Just a reminder that Coinbase custody is a different product to the app you install from the App Store. The faq you posted I believe refers to the latter. If you are a large institutional investor you would likely use this and not a normal coinbase account. I don’t work on custody but they may have a different insurance policy and or do things on a case by case basis: http://custody.coinbase.com/faq http://custody.coinbase.com/faq “ What storage systems does your insurance cover? - Coinbase’s policy covers all storage methods. This includes hot, warm and cold storage. Read more about our insurance policy here or ask the Custody team for more information.” If you are interested in learning more here is a good article on insurance and cryptocurrency: https://blog.coinbase.com/on-insurance-and-cryptocurrency-d6db86ba40bd https://blog.coinbase.com/on-insurance-and-cryptocurrency-d6...

kevindong 6y ago
Huh TIL Coinbase has a product for large investors. Regardless per that FAQ page you linked: > We carry an annually renewed commercial crime policy that carries a $255m limit (per-incident and overall), with Coinbase Global as the named insured. So in the event of a security breach, it's probable that losses would exceed the insured amount.