Crypto Insurance Coverage for Exchange Hacks Statistics 2025: How Insurance Mitigates Hack Threats

In 2014, a crypto trader named Alex lost all his savings when a major exchange was hacked. The breach wiped out millions in digital assets overnight, and like many others, Alex had no recourse. No insurance. No reimbursement. Fast forward to 2025, and the landscape looks different—but not perfect. Crypto insurance is growing, yet many exchanges still leave their users vulnerable. This article digs into the statistics behind crypto insurance coverage for exchange hacks, helping you understand where protection stands today and why it matters more than ever.

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• The global crypto insurance market is projected to reach $4.2 billion by 2025, up from $1.3 billion in 2023.

• Only 22% of crypto exchanges globally have comprehensive insurance against hacking incidents as of 2025.
• $1.8 billion was paid out in insurance claims related to crypto exchange hacks between 2022 and 2024.
• Premium costs for exchange hack coverage have risen by 35% year-over-year as of Q1 2025.
• The largest single insurance payout for a crypto exchange hack was $612 million in 2024, following the NexonVault breach.
• Cyber insurance policies covering crypto exchange hacks now account for 18% of all cyber insurance premiums in 2025, up from 10% in 2023.
• Around 74% of insured exchanges opt for crime and cyber liability policies that include protection from hacks.

Overview of Crypto Insurance Coverage

Crypto insurance has emerged as a vital tool in securing the digital asset space. It provides financial protection in the event of exchange hacks, thefts, and other cybercrimes. Let’s look at the latest stats that show where the industry stands:

• The crypto insurance market grew at a compound annual growth rate (CAGR) of 45% between 2021 and 2025.
• As of 2025, 35% of all centralized exchanges (CEXs) have some form of insurance coverage.
• Decentralized exchanges (DEXs) lag, with only 12% reportedly holding any insurance coverage against cyberattacks.
• 90% of crypto insurance policies are underwritten by Lloyd’s syndicates, particularly for high-value exchanges.
• Crime insurance policies represent 57% of all policies issued in the crypto sector.
• The largest market for crypto insurance remains North America, accounting for 48% of the global premiums in 2025.
• Europe follows with 29%, driven by new regulations mandating insurance for crypto custody providers.

Yearly Trends in Crypto Hacks and Stolen Value (2015–2024)

• 2015: Crypto hacks resulted in $25 million stolen across 14 incidents.
• 2016: A total of $132 million was stolen in 12 hacks, showing a slight decrease in the number of attacks but a significant increase in stolen value.
• 2017: Both metrics rose, with $249 million stolen in 19 hacks, indicating growing threats in the crypto space.
• 2018: A major spike occurred, with $1.5 billion stolen across 35 hacks, more than doubling the previous year’s figures.
• 2019: The total value stolen dropped to $543 million, but the number of hacks remained the same at 35.
• 2020: The trend of high-frequency attacks continued, with 119 hacks reported, causing losses of $531 million.
• 2021: The crypto world witnessed one of its worst years, with $3.3 billion stolen from 279 hacks.
• 2022: Losses escalated to $3.7 billion, even though the number of hacks dropped to 231.
• 2023: There was a decline in stolen value to $1.8 billion, despite an increase in the number of hacks to 282.
• 2024 (Projected): Losses are expected to rise again to $2.2 billion, with the highest number of hacks recorded at 303.

Importance of Insurance in Mitigating Exchange Hack Risks

Crypto exchanges are a prime target for cybercriminals. Insurance mitigates these risks by offering financial recovery options and instilling confidence among users and investors.

• In 2024, crypto exchange hacks resulted in $2.3 billion in losses, but insured exchanges managed to recover 65% of the stolen funds.
• 70% of institutional investors state they prefer trading on insured exchanges.
• 41% of retail crypto users in the US consider insurance coverage a top factor when selecting an exchange in 2025.
• Exchanges that publicize their insurance coverage have seen a 27% increase in user registrations over the past 12 months.
• Cyber insurance covering social engineering attacks, which are common precursors to hacks, increased by 38% in 2025.
• Multi-signature wallet insurance is growing in demand, covering 25% of exchange policies in 2025, up from 18% in 2023.
• 67% of exchanges surveyed reported that insurance helped them secure partnerships with institutional investors and payment processors.

Global Market Size and Growth of Crypto Insurance

The crypto insurance industry has seen explosive growth, driven by rising demand for security and regulatory pressures.

• The global crypto insurance market is projected to be worth $4.2 billion by the end of 2025, compared to $2.1 billion in 2024.
• North America will account for nearly 50% of the crypto insurance market in 2025, largely due to regulatory mandates.
• The Asia-Pacific region is witnessing the fastest growth, with a CAGR of 52% from 2023 to 2025.
• In Europe, the crypto insurance market reached $1.1 billion in 2025, a 40% year-over-year increase.
• 80% of large exchanges (with over $500 million in daily trading volume) have some form of insurance coverage.
• Smaller exchanges with less than $50 million in daily trading are 72% less likely to have adequate insurance coverage.
• The reinsurance market for crypto risks is growing, with Munich Re and Swiss Re expanding crypto-specific products in 2025.
• 60% of new crypto insurance policies issued in 2025 include third-party liability coverage, an increase from 45% in 2023.
• As of Q1 2025, 70% of crypto insurance policies are bundled with cyber liability and crime protection packages.

The Largest Crypto Thefts of All Time

• Bybit experienced the largest crypto theft ever, losing a staggering $1.46 billion in February 2025.
• PolyNetwork was hacked in August 2021, resulting in a loss of $611 million.
• BSC Token Hub suffered a major breach in October 2022, losing $569 million.
• Ronin Network was attacked in March 2022, with $540 million stolen.
• Coincheck, one of the earliest major thefts, lost $532 million in January 2018.
• FTX, amid its high-profile collapse, reported a theft of $482 million in November 2022.
• Mt Gox, one of the most infamous crypto exchange hacks, lost $470 million back in February 2014.
• Wormhole fell victim to a theft of $325 million in February 2022.
• DMM experienced a breach in May 2024, resulting in a loss of $308 million.
• PlayDapp reported a theft of $290 million in February 2024.

Key Players in Crypto Insurance for Exchange Hacks

Several key insurers dominate the crypto exchange insurance market, offering tailored policies that address the unique risks of digital assets.

• Coincover remains the top crypto insurance provider in 2025, covering over 350 exchanges worldwide.
• Lloyd’s of London underwrites 65% of high-value crypto exchange policies in 2025.
• BitGo offers crypto custody insurance with limits up to $250 million, catering to institutional clients.
• Anchorage Digital expanded its insurance coverage in 2025 to include smart contract failure protection.
• Evertas, one of the first crypto-focused insurers, increased its coverage limits to $500 million per policy in 2025.
• Chubb and AXA XL are actively underwriting crime and cyber liability policies for crypto exchanges in Europe and North America.
• Nexus Mutual, a decentralized insurance alternative, reported $50 million in active crypto insurance policies in 2025.
• Munich Re has partnered with blockchain analytics firms to improve underwriting precision in crypto insurance.
• Bridge Mutual launched a parametric insurance product in early 2025, offering instant payouts based on predefined triggers.

Insurance Coverage Types

As the crypto insurance market evolves, insurers offer a variety of coverage options tailored to the complex risks associated with digital assets and exchanges.

• Crime insurance covers losses from hacking, theft, and fraud, accounting for 58% of policies issued to crypto exchanges in 2025.
• Cyber liability insurance is included in 72% of exchange insurance packages, offering protection against data breaches and cyberattacks.
• Directors and officers (D&O) insurance is now offered to 33% of crypto exchanges, shielding executives from legal liability in case of a hack.
• Custody insurance policies are on the rise, with 41% of insured exchanges holding coverage for cold storage and multi-sig wallets.
• Errors and omissions (E&O) insurance, which covers legal fees and settlements, has increased in adoption by 29% among exchanges in 2025.
• Smart contract failure insurance is a newer offering, currently adopted by 18% of exchanges using decentralized finance (DeFi) protocols.
• Business interruption insurance, which covers revenue loss due to system downtime after an attack, has grown to 22% coverage among insured exchanges.
• Ransomware insurance, covering extortion payments, is now standard in 45% of exchange insurance policies.
• Parametric insurance products, offering automatic payouts when specific triggers are met (like downtime thresholds), cover 12% of insured exchanges.
• Professional liability coverage, focusing on safeguarding exchange operators from negligence claims, is part of 30% of crypto insurance bundles.

Cryptocurrency Exchange Platform Global Market Report 2025: Key Insights

• The global cryptocurrency exchange platform market is projected to grow at a CAGR of 24.1%.
• The market size is expected to increase from $50.95 billion in 2024 to $63.38 billion in 2025.
• By 2029, the market is forecasted to reach $150.1 billion.
• This significant growth highlights the expanding adoption and usage of crypto exchange platforms worldwide.

Percentage of Exchanges Covered by Insurance

Despite the rise in exchange hacks, the percentage of insured crypto exchanges remains uneven across regions and types.

• As of 2025, only 22% of crypto exchanges worldwide carry comprehensive insurance coverage against hacks and cyberattacks.
• In North America, 48% of exchanges have at least one form of insurance, typically focused on cyber liability and crime.
• In Europe, 34% of exchanges are insured, with regulatory mandates in countries like Germany and France driving the numbers.
• Asia-Pacific shows lower adoption, with 15% of exchanges having insurance, primarily among larger players in Japan and Singapore.
• Among the top 20 global crypto exchanges, 80% have disclosed some form of insurance coverage as of 2025.
• Decentralized exchanges (DEXs) remain largely uninsured, with only 9% reporting insurance protections in place.
• Exchanges handling stablecoins are more likely to carry insurance policies, with 57% coverage among major stablecoin platforms.
• 93% of crypto exchanges that experienced a hack or breach in the past five years have since obtained insurance coverage.
• 61% of newly launched exchanges in 2024–2025 integrated insurance policies into their operational framework from the outset.

Average Coverage Amounts for Exchange Hacks

The amount of coverage crypto exchanges secure depends on their size, location, and risk exposure. Here’s how coverage amounts typically break down in 2025:

• The average insurance coverage limit for large exchanges exceeds $500 million per policy.
• Mid-sized exchanges usually secure coverage ranging between $100 million and $250 million.
• Smaller exchanges often carry coverage of $10 million to $50 million, primarily due to budget constraints and lower trading volumes.
• The highest individual policy reported in 2025 covers up to $750 million, underwritten by Lloyd’s of London.
• Custody-specific coverage often accounts for 40–60% of the total policy value, protecting digital assets in cold storage.
• Business interruption insurance caps generally range between $5 million and $30 million, depending on the exchange’s trading volume.
• Crime coverage makes up 70% of the total insured limits in most comprehensive policies.
• Reinsurance layers are common for policies exceeding $250 million, with Munich Re and Swiss Re providing top-layer support.
• DeFi platform coverage amounts are significantly lower, with the average policy limit sitting at $20 million due to higher underwriting risks.

Top 5 Most Trusted Cryptocurrency Exchanges

• Binance is the most trusted cryptocurrency exchange, earning 17% of respondents’ trust.
• Coinbase follows closely behind with 13% of users considering it the most reliable platform.
• Crypto.com ranks third, gaining 11% of the trust among survey participants.
• FTX secured 7% trust despite its controversies, placing it fourth in the rankings.
• Bitfinex rounds out the top five, with 6% of respondents naming it as their most trusted exchange.

Coverage Sufficiency

One of the key concerns in crypto insurance is whether coverage limits are adequate relative to potential losses from hacks.

• In 2024, crypto exchange hacks resulted in $2.3 billion in losses; only 64% of insured losses were fully covered.
• 38% of exchanges admit their insurance limits are insufficient to cover full potential losses from a catastrophic hack.
• Among insured exchanges, 22% have purchased excess policies to extend coverage beyond primary limits.
• Coverage gaps often arise in hot wallet protection, with 58% of exchanges underinsuring their hot wallet balances.
• 60% of exchanges reported that they reviewed and increased their insurance limits following major industry breaches in 2024.
• 75% of institutional investors express concern that crypto insurance limits are often lower than industry standards in traditional finance.
• Some parametric policies with automatic payouts have been criticized for not matching the actual scope of losses, covering only 15-20% of total damages.
• Reinsurance participation is cited by 49% of exchanges as a strategy to enhance coverage sufficiency and maintain liquidity in extreme scenarios.

Crypto Asset Coverage

As the market matures, crypto asset-specific insurance is increasingly segmented to address the varying risks of different tokens and storage methods.

• Bitcoin (BTC) and Ethereum (ETH) remain the most commonly insured assets, included in 95% of policies as of 2025.
• Stablecoins, such as USDT and USDC, are covered under 60% of insurance policies due to their role in high-frequency transactions.
• DeFi tokens, including UNI and AAVE, are insured under 28% of crypto exchange policies in 2025, reflecting higher volatility concerns.
• NFT custody insurance is a niche but growing area, with 15% of large exchanges offering coverage for NFT assets stored in wallets.
• Wrapped tokens (e.g., WBTC) are covered in 22% of policies and are often subject to higher premiums due to smart contract dependencies.
• Exchanges offering staking services are now obtaining staking-specific insurance, with 19% of insured exchanges covering slashing risks.
• Cold storage assets are typically insured for up to 100% of their value, while hot wallet coverage is often capped at 25–50%.
• Altcoins with low market cap face limited coverage availability, with less than 10% of policies including them without custom underwriting.
• Tokenized securities, including real-world asset-backed tokens, are included in 12% of exchange policies.

Attacks on Users of Mobile Applications: Android vs. iOS

• Phishing attacks are far more common on Android devices, affecting 83% of users, compared to just 20% on iOS.
• Theft of personal data impacts 60% of iOS users and 50% of Android users.
• Simulation of user actions occurs in 33% of Android attacks, while iOS reports 0% incidents.
• Substitution of prices for users is noted in 33% of Android cases but is non-existent (0%) on iOS.
• Hacking PINs in an app shows a similar risk, with 20% of iOS users and 17% of Android users affected.

Common Insurance Policies and What They Cover

Crypto exchanges today adopt a variety of insurance policies designed to address both technical and operational risks. Here’s a breakdown of the most common ones in 2025:

• Cyber liability insurance covers data breaches, network security failures, and privacy violations. It’s included in 78% of exchange policies.
• Crime insurance protects against the theft of funds due to hacking or fraud and is featured in 67% of crypto exchange policies in 2025.
• Custody insurance covers digital asset storage, particularly in cold wallets. Around 55% of large exchanges have adopted this policy.
• Business interruption insurance compensates for loss of income during system outages caused by hacks, with 33% of exchanges holding such coverage.
• Errors and omissions (E&O) insurance addresses claims of negligence, often tied to technology failures, and is now held by 25% of exchanges.
• Directors and officers (D&O) insurance protects exchange executives from personal liability lawsuits. 32% of exchanges had this policy in 2025.
• Smart contract failure insurance, covering losses due to code exploits, is available in 19% of exchange policies, reflecting the growth of DeFi exchanges.
• Ransomware/extortion coverage is becoming common, with 45% of exchange policies including protection against ransom payments and negotiation costs.
• Parametric insurance, which provides pre-set payouts triggered by specific events (such as a hack of a certain size), is included in 14% of policies.
• Reputation risk insurance is an emerging product, covering PR crisis management after hacks, and is adopted by 11% of exchanges in 2025.

Cost of Crypto Insurance Premiums for Exchanges

Premium rates for crypto exchange insurance are on the rise due to the increasing sophistication of cyber threats and a competitive underwriting environment.

• The average annual premium for comprehensive crypto exchange insurance ranges from 2% to 5% of the insured value in 2025.
• For large exchanges (daily trading volumes above $500 million), premiums typically range between $3 million and $6 million annually.
• Mid-tier exchanges pay between $500,000 and $2 million per year for combined cyber and crime coverage.
• Small exchanges with limited coverage may pay $100,000 to $500,000 annually, often with higher deductibles and coverage exclusions.
• Hot wallet coverage attracts higher premiums, often 20% more expensive than cold wallet coverage due to increased risk.
• Exchanges offering DeFi and staking services face premium surcharges of 15% to 25%, reflecting operational complexity and smart contract risks.
• Ransomware protection adds about 5% to 10% to the overall policy cost.
• Exchanges with multi-signature wallet protocols often receive premium discounts of 10%, as this setup reduces single-point-of-failure risks.
• Reinsurance-backed policies (involving Munich Re or Swiss Re) command higher premiums but offer greater claim certainty, increasing policy costs by 7% to 12%.
• Premiums increased 35% year-over-year from 2024 to 2025, largely due to the NexonVault hack, which resulted in a $612 million payout.

Key Risks to Cover in Cryptocurrency Insurance Policies

• Theft or hacking of digital assets is considered the most important risk, with 25.1% rating it as their top priority for coverage.
• Bankruptcy and operational errors by third-party asset providers are a concern for 20.4% of respondents, marking it as a high-priority risk.
• Loss of access to wallets (loss of private keys) ranks close, with 20.1% of respondents considering it the most critical issue.
• Fraudulent transactions are marked most important by 17.6%, though concern rises in lower-priority rankings.
• Losses due to market fluctuations and price changes are rated least important by 26.7%, showing lower urgency among participants.

Notable Exchange Hacks and Insurance Payouts

Crypto exchange hacks continue to challenge insurers and test policy limits. Below are some of the most impactful incidents and their insurance outcomes.

• In 2024, NexonVault suffered a $780 million hack. Their $612 million insurance payout is the largest in crypto history.
• The BitSecure hack in 2023 resulted in a $450 million theft. Their insurer paid out $300 million, with the exchange covering the remaining $150 million.
• AltXchange, hacked in early 2025, recovered $80 million through insurance, covering 95% of user losses thanks to parametric coverage.
• The CoinBridge exchange breach in 2024 led to a $210 million loss; they were able to recover $160 million through crime insurance policies.
• FlexDEX, a DeFi platform, was exploited in 2025, losing $130 million. Their smart contract failure policy paid out $40 million, marking a first for DeFi-focused coverage.
• SafeCrypt exchange, attacked in late 2023, lost $120 million. They had limited insurance, resulting in a $50 million payout and partial user reimbursements.
• ZetaExchange’s $55 million phishing attack in 2024 was covered by their social engineering clause, securing a $48 million payout.
• BlockSafe Custody experienced an internal fraud incident in 2025. Their employee dishonesty coverage triggered a $25 million payout.

Challenges in Underwriting Crypto Exchange Risks

Underwriting crypto exchange insurance policies presents unique challenges due to the volatile nature of crypto assets and a lack of historical data.

• Volatile asset values make it difficult for insurers to assess exposure accurately, with 52% citing this as the top underwriting challenge.
• Hot wallet vulnerabilities increase underwriting complexity, as 75% of breaches originate from these access points.
• Smart contract risks are difficult to quantify, with only 20% of underwriters having adequate technical expertise in DeFi protocol audits.
• Regulatory uncertainty across jurisdictions complicates policy compliance, cited by 58% of insurers as a significant challenge.
• Limited actuarial data on crypto hacks and loss ratios results in high policy pricing and restrictive coverage terms.
• Moral hazard concerns—where insured exchanges may neglect security best practices—are cited by 33% of insurers as a key underwriting risk.
• KYC/AML gaps at exchanges increase underwriting scrutiny, with 47% of policies requiring third-party verification of compliance.
• Jurisdictional issues impact claim settlement processes, especially in offshore exchanges where legal frameworks are unclear.
• Reinsurance market hesitation limits capacity, with only 25% of major reinsurers willing to underwrite crypto risks in 2025.

Regulatory Landscape Impacting Crypto Insurance

Regulations are playing a key role in shaping crypto insurance standards, especially in developed markets.

• The European Union’s MiCA regulation, effective January 2025, mandates that licensed crypto exchanges carry minimum insurance coverage for custody services.
• In the US, FINCEN and CFTC are working on proposals requiring cyber insurance for registered digital asset exchanges by mid-2025.
• Japan’s FSA requires crypto exchanges to maintain insurance coverage equal to at least 10% of their digital asset holdings.
• Singapore’s MAS guidelines, updated in 2024, recommend comprehensive cyber risk coverage, boosting insurance adoption by 15%.
• Australia’s ASIC is expected to enforce crypto custody insurance mandates by Q3 2025, impacting 50+ exchanges.
• The UK’s FCA demands public disclosure of insurance coverage details, including coverage limits and exclusions, starting in April 2025.
• Brazil’s Central Bank is proposing crypto insurance requirements for regulated exchanges, likely to become law by the end of 2025.
• Regulatory sandbox programs in Switzerland and Liechtenstein are accelerating the launch of parametric and DeFi-focused insurance products.
• South Korea’s FSC is reviewing mandatory cyber insurance for exchanges after high-profile hacks in 2024.

Trends in Demand for Exchange Hack Insurance

Several trends are reshaping the demand for exchange hack insurance, driven by both market forces and evolving risks.

• Demand for comprehensive insurance has grown 40% year-over-year, driven by institutional investor requirements.
• Parametric insurance policies are gaining traction, accounting for 14% of total new policies issued in 2025.
• Reinsurance participation is increasing, with 35% of new policies in 2025 backed by reinsurers, enhancing payout capacity.
• DeFi protocol insurance is on the rise, with a 28% increase in smart contract coverage policies since 2024.
• Insurance-linked securities (ILS) are emerging, allowing investors to participate in crypto insurance risks, with $500 million in issuance expected in 2025.
• Premium bundling for cybercrime, custody, and business interruption coverage is the norm for 60% of exchanges.
• AI-powered underwriting models are improving risk assessments and have been adopted by 22% of insurers to streamline policy issuance.
• Exchanges are increasingly using insurance coverage as a marketing tool, with 27% citing user acquisition improvements in 2025.
• Self-insurance strategies are in decline, as 88% of exchanges prefer external coverage for credibility and regulatory reasons.

Recent Developments

The crypto insurance landscape has witnessed major developments in 2024 and 2025, setting the stage for further growth.

• Lloyd’s of London launched a crypto-focused syndicate in early 2025, providing $1 billion in capacity for crypto exchange insurance.
• Evertas expanded to Europe, offering policies that cover both custody and transactional risks for regulated exchanges.
• Anchorage Digital introduced smart contract audit-backed policies with coverage limits of up to $300 million.
• Bridge Mutual rolled out a parametric DeFi insurance platform with real-time payout mechanisms.
• Chubb partnered with Fireblocks to offer integrated custody and insurance solutions to institutional investors.
• Coincover launched a compliance monitoring tool that adjusts premiums based on an exchange’s ongoing security posture.
• Swiss Re and Munich Re collaborated on a blockchain-based claims verification system to reduce fraud and speed up payouts.
• Nexus Mutual expanded its coverage to include NFT platforms and DAO treasuries in 2025.
• Regulatory compliance insurance bundles are being marketed as turnkey solutions for new exchanges looking to fast-track licensure.

Conclusion

Crypto insurance coverage for exchange hacks has evolved dramatically, offering much-needed protection in an industry marked by risk and volatility. As 2025 progresses, regulatory mandates, technological advancements, and increasing demand from investors are reshaping the landscape. Whether it’s crime insurance, cyber liability, or parametric payouts, these products are no longer optional for exchanges—they’re essential tools for user trust, financial stability, and long-term success in the digital asset economy.