Bitget Rolls Out $200M 'Protection Fund' to Safeguard User's Crypto
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  • Bitget wants to shore up trader and investor confidence with a new “protection fund”
  • The exchange is pledging to secure the $200 million value of its war chest over a three-year period

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

The exchange’s $200 million “Protection Fund,” which consists of 6000 BTC and 80 million USDT, is attempting to quell security concerns and boost investor confidence by safeguarding its user’s assets, Bitget said.

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Recent market turmoil, fueled by a lender contagion that caught most 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 payout their users who wished to opt-out of the market.

Coupled with billions of dollars lost to hacks and theft last year alone, trust in the crypto community as well as the platforms seeking to safely store users’ assets continues to erode.

Part of the fund’s stablecoin allocation will help alleviate pressures associated with that volatility rather than relying on crypto fluctuations, Bitget said.

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

Bitget said it has pledged to secure the value of its war chest over a three-year horizon which is 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 to address concerns of accountability … and help win back investors’ confidence.”

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  • Blockworks

    Senior Reporter, Asia News Desk

    Sebastian Sinclair is a senior news reporter for Blockworks operating in South East Asia. He has experience covering the crypto market as well as certain developments affecting the industry including regulation, business and M&As. He currently holds no cryptocurrencies.

    Contact Sebastian via email at [email protected]

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