The chief executive of a Bermudian-headquartered cryptocurrency insurer has called on the crypto community to embrace enhanced insurance solutions for digital asset security after a $1.4 billion hack that is thought to be the largest cryptocurrency theft in history.

Jeffrey Glusman is the chief executive of Blockchain Deposit Insurance Corporation, which launched last month.

The company’s cryptocurrency insurance platform is designed to protect digital currency wallet holders from exchange failures and cyber exploits, and aims to bring institutional-grade security to the crypto ecosystem.

It leverages blockchain technology to automate claims processing and risk assessment using smart contracts, providing coverage for qualified cryptocurrency wallets and digital assets.

The company said Mr Glusman’s call to action came “after the unravelling of the high-profile hack on ByBit by the notorious Lazarus Group”.

It said more than $1.4 billion was stolen from the Dubai-based cryptocurrency exchange, triggering withdrawals totalling more than $5.5 billion.

The hack is thought to be the biggest cryptocurrency theft in history

Mr Glusman said: “We sincerely appreciate the cryptocurrency exchange executives, advisers and affiliate partners who have engaged with BDIC since our January launch.

“Recent events, including the ByBit hack and the subsequent $5-plus billion, panic-driven run on crypto accounts, have intensified our discussions with industry leaders, highlighting the critical need for proactive solutions.

“Regardless of how effectively ByBit handled communication and user experience post-hack, it’s clear that additional measures must be implemented. Our conversations have focused on how BDIC’s insurance solutions could mitigate incidents like this and emphasised the importance of initiatives, such as the BDIC Pledge Initiative, which reinforce our commitment to building a secure cryptocurrency ecosystem.

“We look forward to continuing these strategic dialogues, recognising that proactive collaboration is essential to strengthen the market, prevent future disruptions and instil confidence necessary for widespread cryptocurrency adoption.

“We remain dedicated to this mission and invite those aligned with our goals to join us in this critical effort. The BDIC community was established precisely for these challenges and together we can transform the global financial landscape by replacing uncertainty with security.”

In the BDIC pledge initiative, the company said: “We are calling on responsible cryptocurrency projects to contribute 1 per cent of their total token supply to support a comprehensive insurance and risk-mitigation infrastructure. This collaborative approach transforms individual project vulnerabilities into a collective defence mechanism network.”