A Comparative Assessment of Digital Assets Insurance in the Nigerian, United Kingdom and American Model

Abstract

The advent of blockchain technology triggered digital assets investments which has become a driving force in the fourth industrial revolution. However, the evolving nature of blockchain and digital assets makes them susceptible to volatile market meltdown thereby creating uncertainty of investment and making insurance policies hard to obtain. This paper focused on the necessity for, and availability of insurance options within the digital assets ecosystem in Nigeria. Adopting the doctrinal research methodology and comparative approach, the paper examined the extant legal regime on insurance in Nigeria and found  that whereas there is no proscriptive rule on digital assets insurance, the volatility of the market, lack of proper awareness on the necessity of insurance policies and absence of legislative firmness continue to disrupt the efficacy of insurance in stabilising the digital assets market in Nigeria.  Comparative studies further revealed that digital asset insurance is an imperative for any economy desirous of leveraging on digital assets investment for economic sustainability. Finding that the Nigeria Insurance Industry Reform Act, having repealed insurance laws for specific sectors have consolidated insurance business in a manner that provides sectors like digital assets investment with no special insurance incentive; the paper recommends further amendments that would specifically encourage insurance incentives for the consolidation and sustenance of digital assets investment.