On Tuesday this week, the New York Department of Financial Services issued the first license to a digital currency firm, a major first step in developing the still-nascent “virtual currency” industry. Aptly named “BitLicense,” the operating license is the first of its kind to provide supervision over capital, consumer protection, cybersecurity, and anti-money laundering requirements for virtual currency. [NYDFS]
This development is timely, with stories of bitcoin vulnerabilities making headlines since the Mt. Gox exchange suspended operations in February 2014. [Coindesk] More recently, news that bitcoin payment processor BitPay was the target of a phishing attack that cost it $1.8 million highlighted the continued concerns with the new currency. [American Banker] After BitPay’s insurer denied a claim for the loss, BitPay filed a bad faith and breach of contract claim that raises other questions about the potential limits of cybersecurity insurance.
Even with these questions, the popularity of such insurance has skyrocketed in recent years, with some estimates putting the growth of the cybersecurity insurance market at 30% a year. [CIO]
As the digital currency and fintech trends continue, we can expect to see more development in the cybersecurity insurance market, including a further definition of the boundaries and reach of such coverage.
S.P. Slaughter
Follow me on Twitter: @SP_Slaughter
This development is timely, with stories of bitcoin vulnerabilities making headlines since the Mt. Gox exchange suspended operations in February 2014. [Coindesk] More recently, news that bitcoin payment processor BitPay was the target of a phishing attack that cost it $1.8 million highlighted the continued concerns with the new currency. [American Banker] After BitPay’s insurer denied a claim for the loss, BitPay filed a bad faith and breach of contract claim that raises other questions about the potential limits of cybersecurity insurance.
Even with these questions, the popularity of such insurance has skyrocketed in recent years, with some estimates putting the growth of the cybersecurity insurance market at 30% a year. [CIO]
As the digital currency and fintech trends continue, we can expect to see more development in the cybersecurity insurance market, including a further definition of the boundaries and reach of such coverage.
S.P. Slaughter
Follow me on Twitter: @SP_Slaughter
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