Bitget Rolls Out $200M ‘Protection Fund’ to Safeguard User’s Crypto

The Singapore-based exchange is hoping the fund will help boost its profile and restore trust in the community by insuring against hacks

article-image

Singapore; Source: Shutterstock

share

key takeaways

  • Bitget wants to shore up trader and investor confidence with a new “protection fund”
  • Bitcoin and tether will make up the exchange’s war chest, currently worth more than $200 million

Singapore-headquartered crypto derivatives exchange Bitget said Sunday it has launched a new fund designed to safeguard against hacks and theft — a bid to lift the industry’s image after crypto’s recent downturn.

The exchange’s $200 million-plus “Protection Fund,” which consists of 6,000 BTC ($140.2 million) and 80 million USDT, is an attempt to quell security concerns and boost investor confidence, Bitget said.

Recent market turmoil, fueled by lender contagion that caught many industry participants by surprise, has battered faith in crypto’s ability to weather significant periods of volatility.

Multiple lenders and exchanges moved to restrict or freeze crypto asset withdrawals from their platforms following revelations they didn’t have the capital on hand to satisfy users who wished to opt-out of the market.

Coupled with billions of dollars lost to hacks and theft last year, trust in the crypto community alongside the platforms storing users’ assets continues to erode.

Part of the fund’s stablecoin allocation is meant to help alleviate pressures associated with market volatility, Bitget said.

The exchange, established in 2018, is one of South-East Asia’s fastest growing derivatives exchanges boasting around 20,000 active traders. Bitget processed close to $100 billion in transactional value in 2021, according to its LinkedIn profile.

Bitget has pledged to secure the value of its war chest over a three-year horizon. It’s expected to be self-funded and non-reliant on third-party insurance in what it believes will help navigate beyond “external bureaucracy” or “policy changes.”

“The protection fund will help us mitigate investors’ concerns and attract potential users,” Bitget’s managing director Gracy Chen said in a statement. “We believe our initiative would encourage other CEXs [centralized exchanges] to address concerns of accountability … and help win back investors’ confidence.”

The move echoes Binance’s decision to establish its so-called “Secure Asset Fund” in 2018, which came in handy when hackers raided the exchange for $40 million in the following year.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

HYATT REGENCY SALT LAKE CITY

TUES, OCT. 8, 2024

Guided by the expertise of Blockworks Research Analysts team, this one day event will feature senior leaders, entrepreneurs, and developers from across the crypto industry. Attendees will have the opportunity to participate in an immersive experience to explore the latest trends, […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

hivemapper.jpeg

Research

We believe crypto market participants overlook Hivemapper’s fundamental potential due to a poor understanding of both the niche map data market and Hivemapper’s positioning relative to incumbents. Hivemapper’s token model catalyzes both a cost and product advantage via unmatched map freshness and near real-time accuracy, which is its wedge into a market characterized by stale data and high data collection costs. Its current and potential future product suite may represent one of the strongest possibilities for PMF in crypto today.

article-image

👨‍⚖️ SBF’s courtroom sequel: Plus, Coinbase’s legal loss was DeFi’s gain

article-image

Public mining companies have been acquiring sites, refreshing machine fleets and diversifying business models in preparation for the event

article-image

Exploit shows centralization can sometimes be an asset

article-image

The Fidelity Ethereum Fund, like other proposed ETH ETFs, seeks to stake a portion of its assets, according to the firm’s Wednesday registration statement

article-image

The DAO first voted on enabling SAFE transfers over a year ago