One of the largest insurance companies on the African continent, Old Mutual, part of the eponymous financial holding company, refused to insure the equipment for mining cryptocurrencies because of the high risk and speculative nature of the industry, reports ItWeb.
The company conducted their own investigation and assessed the feedback of customers who have lost money on mining. This was the justification for the decision on the termination of any insurance business, directly or indirectly associated with cryptocurrencies.
In Old Mutual also stressed that a risk analysis in respect of such immature and volatile industry is extremely difficult, especially given the lack of regulation and use of digital currency in money laundering and cybercrime.
The company’s experts added that the continuous operation of expensive equipment creates risks of overheating and other malfunctions that are difficult to calculate.
«The price of such equipment is usually highly overpriced, and to assess its real value is not possible, because suppliers from the Far East [i.e. China] is extremely opaque», — concluded the expert of Old Mutual Christell Coleman.
Recall, the company Group-IB has made a rating of reliability of cryptocurrency exchanges, in terms of insurance stored on them means.