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Insured Bitcoin ‘Vault’ Launched In UK

Tom Brewster is TechWeek Europe's Security Correspondent. He has also been named BT Information Security Journalist of the Year in 2012 and 2013.

UK-based Elliptic says it has a cheap and secure way of protecting bitcoin owners from theft and loss

A UK start-up has launched insured Bitcoin storage for anyone worried about their cryptocurrency being stolen or going missing.

Using “deep cold storage techniques”, and by storing private keys in multiple locations, Elliptic said it could keep bitcoins secure. The Vault service is insured by a Lloyd’s of London underwriter and customers can choose the value of bitcoin they want secured.

BitcoinAn annual rate of two percent of the chosen coverage is charged by Elliptic. There is a minimum withdrawal size of one bitcoin, which is currently worth around $850. Insurance cover levels start at £5,000.

Elliptic Bitcoin vault

“Securing your bitcoins involves implementing advanced encryption and even then you are still at risk of losing them,” said co-founder Tom Robinson. “Elliptic Vault secures your bitcoins for you and is insured against theft or loss, so our customers can have peace of mind that their bitcoins are safe.”

On its website, Elliptic has promised to build “a suite of services that will make it easier and more secure to acquire, use and store digital currencies”, saying other products than Vault were on the way.

“And we are working with the UK government and financial regulators to help shape a sensible regulatory framework for digital currencies,” the company claimed.

Professor Alan Woodward, of the Department of Computing at the University of Surrey, advised anyone considering using the Vault to check the terms and conditions.

“Storage in the cloud means that you have to trust whomever you store those bitcoins with.  But ‘twas ever thus.  The big difference is that they are not regulated like a traditional bank, but they are still subject to the law.  I think anyone using such a service is well advised to check the terms and conditions,” he told TechWeekEurope.

There have been a host of big-name bitcoin thefts over recent months. As the currency’s value has catapulted towards and occasionally over the $1,000 mark, losses have been increasingly catastrophic for the victims.

In November, it emerged Global Bond Limited, a Bitcoin exchange, had disappeared from the Internet, along with 30 million Yuan (£3m) it held in investments, claiming it had been compromised. In August, it was alleged all Android bitcoin wallets used a vulnerable random number generator that left them open to theft.

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