Crypto Hacks Leave Industry With Shrunken Insurance Safety Net
The crypto industry has seen $3.63 billion in losses due to hacks over the past 19 months, and the insurance safety net that's supposed to help mitigate those losses is shrinking.
According to CoinGecko's 2026 State of Crypto Security Report, on-chain insurance coverage fell by 20.2% from $163.2 million to $130.2 million between January 2025 and July 2026.
This reduction in available protection comes at a time when hackers are more active than ever. The top ten incidents alone represented 72.5% of total stolen value, with infrastructure and supply-chain attacks accounting for over $1.8 billion of those losses.
The on-chain insurance market is struggling due to high premiums, difficulty attracting capital providers, and the fact that insuring an asset class that hackers treat like an all-you-can-eat buffet can be a tough sell.