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Becca Rubenfeld explains why insurance and inheritance are key to making Bitcoin secure and ready for institutions.
The episode explores how Anchorwatch is building the critical infrastructure, insurance, inheritance, and risk mitigation, needed for Bitcoin’s long-term integration into the financial system. Becca Rubenfeld outlines how Anchorwatch addresses rising threats like wrench attacks through insured custody and kidnap & ransom coverage, while also solving the inheritance challenge with a time-locked, multi-layered custody model that ensures access for beneficiaries regardless of technical knowledge. By combining Bitcoin-native tools like miniscript with legal clarity and institutional-grade compliance, Anchorwatch bridges self-custody with the standards of traditional finance. As legacy institutions begin embracing Bitcoin, Anchorwatch positions itself as the essential infrastructure unlocking lending, capital flows, and Bitcoin’s role as pristine collateral, laying the groundwork for mainstream adoption and hyperbitcoinization.
“Just having any amount and being public about it actually puts you at risk.”
“Most treasure maps don’t work. People forget. It’s not that they’re dumb, it’s that inheritance is hard.”
“Our recovery layer opens a month before the policy ends. Even if we disappear, you still get your Bitcoin.”
“KN&R insurance covers not just the ransom, it brings in professional hostage negotiators backed by Lloyd’s.”
“We’re going to double the insurance capacity available to Bitcoin this year alone.”
“If you're a fiduciary paying bips for uninsured custody, how can you justify that to your clients?”
“The reason you insure isn’t just to protect yourself, it’s to give confidence to everyone who depends on you.”
“Bitcoin doesn’t need a new narrative, it needs infrastructure.”
“We were skating to where the puck was going. Now it’s here.”
“This is not just a startup story. It’s about making Bitcoin viable for the next generation.”
This episode offers one of the most grounded and essential discussions in Bitcoin, as Becca Rubenfeld highlights the real-world challenges, inheritance, safety, and fiduciary responsibility, that must be addressed for broader adoption. Anchorwatch is bridging the gap between self-custody and traditional finance by pairing Bitcoin-native tools with institutional-grade insurance and legal infrastructure. As they become a Qualified Custodian and deepen ties with reinsurers like Lloyd’s, they’re unlocking safer lending, capital inflows, and long-term legitimacy, positioning insurance as a foundational layer of Bitcoin’s financial future.
0:00 - Intro
0:45 - AnchorWatch inheritance
6:27 - Explaining inheritance protocol
10:25 - Estate planner reaction
14:48 - Bitkey & Opportunity Cost
16:26 - Onboarding process & ransom insurance
30:29 - Unchained
30:54 - Diversification & premium revenue for Lloyd’s
38:13 - Bitcoin in tradfi
49:38 - Forcing function of insurance requirements
58:14 - How you can take action
(00:00) This wrench attack thing in the last six months has been really intense. They've been accelerating significantly. The ones that make the news, 10 million, 20 million, they're significant dollars. A guy was murdered for $58,000. Just having any amount and being public about it actually puts you at risk.
(00:19) Yeah, that guy in Morocco who was essentially contracting out kidnappers in France. Anchorwatch never claims that we have ownership over a customer's assets. So if you get hit by a bus, you know, just a month into the policy or something, it would be really challenging to steal your Bitcoin right now. Like loans are very overcolateralized.
(00:35) That slow grind turns into a hyper bitcoinization real quick. Custody solutions like Coinbase, Fidelity, whatever it may be. Yeah, it's effectively uninsured. Becca, welcome back to the show. Hey Marty, thanks for having me. Happy to be here. It's great to have you. the uh I was just going through your your ex account while you were making a coffee. Uh you guys are doing spaces.
(01:02) That's I think this is where I want to start. You guys are doing spaces and I'm interested. I haven't been able to hop in. Mhm. like what are the what are like the number one questions that people have for you guys at Ankoratch because I I think you guys have built up the brand in an incredible way over the last few years and brands well established but this this whole idea of ensuring your Bitcoin right um in cold storage with a unique custody setup that Anchoratch has really pioneered um how comfortable are people
(01:35) with it uh right know get getting comfortable. So I think one of the the amazing thing about our product or the kind of combination of our product is that it really is next level security. So the custody platform is in fact unique but we would certainly say it's superior to legacy multisig. The insurance is unique but that's a whole new concept.
(02:01) And so the reality is that it takes a lot to get people familiar with what we're offering. So what we find is that just actual long- form contents, you know, having the opportunity to have conversations with people is really important. So right now what uh we've been doing spaces on regularly is inheritance. So we've been really highlighting how our custody platform works for inheritance, but we get lots of questions in general just about how time locks work, uh how the key management happens. still questions on uh how it is that uh we're required
(02:35) signer, but it also becomes self-custody, things like that. And then of course the insurance, what it covers, how you do claims, dollar denominated versus Bitcoin denominated. So there's lots to dive into when we talk to customers. Yeah, I mean inheritance is a big one. I think that's huge that the inheritance question is implanted in the back of the minds of many Bitcoiners and has been for many years which is like totally like uh it's it's a little iffy it's a little iffy. I mean, it's it's turned into a little bit of a joke,
(03:13) but what happens is people tell us about their treasure maps when we get on calls with with customers and they start telling us like, "Hey, I'm I'm looking at you. I I heard that you're really good for inheritance. I feel pretty good about my setup. I've uh you know, I've walked my wife through it.
(03:33) Um, but I'm just I'm I'm not quite confident, right?" And so they tell us what their treasure map directionally is. They don't obviously share their exact details, but it always it it's always a little bit of a scavenger hunt, right? So it's like a certain piece of information is in a file cabinet and then that takes them to the next piece of information and then maybe they say Marty, I put Marty's name down as my trusted advisor.
(04:04) Um, I I got there there's a lot of people who put very specific uh Bitcoiners down as their trusted adviser and their trusted helper. I I have a feeling that a lot of the industry is putting the same five or 10 names down from what we hear. Uh, and so there's a lot of confidence being put into these individuals that they're still going to be around and available uh to provide that guidance.
(04:30) So yeah, there's a there's a lot of questions that we've tried to solve with the design of our product. Yeah. No, there there was one point I've never told Matt this, but there was one point where I was like, "Anything happens to me. All right, here's where you go. You find this and then you just go ask Matt and he'll know what to do cuz he'll he'll see it and he'll know what to do." Like it's like, "No, it doesn't work.
(04:50) " At least at least you and Matt like it makes sense. But I think there's a lot of people who put down you and Matt who you've never had a conversation with. They just based on your reputation that they they say like you can trust this guy. And uh you know I think you in fact are like people's escape patch. If you're out there and I'm your escape patch, please I I don't want that responsibility.
(05:14) But I mean, I think what we're getting at is highlights like the ridiculous nature of how uh lackluster the solutions for this very important problem have been winners. Totally. I went through I went through this myself before before we had developed this for Anchorwatch where I had my own treasure map for my family and I you know I think I think it's a good one.
(05:39) It's not uh it's straightforward. it it wasn't overly uh complicated. It was easy to follow. And so I told my my family three different subsets of my family. Uh you know, all you have to do is start in this location. And if you start in this location and you read what what is there, it will it will get you all you need. Don't worry.
(06:04) And like four to six months later, I checked in with the family and I was like, "Hey, remember the Bitcoin the Bitcoin inheritance. Uh where what's that location?" You know, where do you start? And two of the three subsets of my family didn't remember. Like they just straight up didn't remember. One of them remembered with prompting. Uh and that's freaky.
(06:25) Super freaky actually. Yeah. And I mean again it highlights the need for a protocol that sort of takes the onus of gathering the key information and getting access to the addresses out of the hands of the people who will be inhering the bitcoin. Uh and this is what you guys have been working on. Totally.
(06:50) So we the way we actually execute the inheritance protocol is using what we call the recovery layer. So the custody solution that Anchorwatch bill is at its core it's it is shared custody between the customer and Ankorwatch while you're insured. So customer has their own private keys. We don't have a backup but we're also a required signer while you're insured.
(07:10) After you're insured using time locks so enabled by miniscript it goes to pure self-custody. So if we've disappeared off the face of the earth, if we were bad actors, if we refused to sign for any reason, it does become pure self-custody after your insurance policy ends. And that's why those private keys are truly your private keys.
(07:30) It is it is self-custody. Right between those two layers though, so there's the we're both required signers and then there's pure self-custody. Right between those layers, there's a multi-institutional recovery recovery layer. And so that's what we would use in the case of the death of a client.
(07:49) And that's the multi-institutional is where Anchorwatch has our keys. And then we have a recovery institution. We've chosen Coin Corner. They're regulated exchange out of the aisle of man. Been around for 10 years, never had any losses. Bitcoin only. Uh so they have their own set of recovery keys.
(08:08) So if if the client dies, the time lock will open to that recovery layer a month before your insurance policy ends. and we could move the Bitcoin from this impaired vault into a brand new vault. So if you die early in your policy, so if you get hit by a bus, you know, just a month into the policy or something, what we would tell the beneficiary is like, okay, your Bitcoin is going to sit here safe and sound, we know that you don't have access to, you know, your spouse's keys or if it's a trustee, that's fine. Whoever the beneficiary is.
(08:39) uh but let's say on September 12th, that's when this recovery layer will come open. We would work with the beneficiary to understand their intentions. Do you want to continue hodling the Bitcoin? If so, if you'd like to be our customer, we'll get you set up on a brand new vault. We'll take care of you. You'll get your own signing devices. We'll educate you.
(08:58) Uh if you need to liquidate it to take care of family matters, you know, we'll we'll assist you in getting the Bitcoin where it needs to go. Um, and then that layer is also insured. So if you have questions on like, well, how do I really know Ankorwatch and Coin Corner won't misuse the multi-institutional custody to steal the customer funds that is specifically covered by the insurance policy and that's why that recovery layer happens while you're still insured because it gives you that peace of mind that we can't misuse it. The way time
(09:29) locks work in Bitcoin though is once they're available, they're always available. So, even if you passed away very close to the end of the policy and it actually the vault bin did go into self-custody and maybe the beneficiary just didn't get in touch with us because they were busy with other things or maybe they didn't get in touch with us at all and we had to look for them uh and like like find out why we weren't hearing from the client.
(09:58) uh eventually when we find that beneficiary once available always available. So that recovery layer is still available even after the vault is in self-custody. So that's how it can be foolproof uh because it really doesn't matter when we uh when the event happens uh we will still be able to assist in recovering the assets. And then we have the legal side of it as well and making sure that we have documentation and everything is very very clear for your trust attorneys, estate attorneys. We dealt with it all on that side, too. Well, that's a natural segue into my next
(10:28) questions, which is how are the estate planners and attorneys that you've interacted with interact or reacting to this solution really positively. So, we we consulted with a number of them in the design of how we did. So, this came to life in our terms of service. So when you actually read, you know, the language there, it's very clear, very easy to understand how we how we approach account ownership.
(10:58) Uh we're very clear that Ankoratch never claims that we have ownership over a customer's assets. So we're always looking for the rightful owner and the rightful owner is either the customer themselves or their beneficiary or their estate. And so it goes through from uh from a legal standpoint kind of the order of operations and who we view as that rightful owner.
(11:20) Uh it goes through the steps needed to kick off the inheritance protocol. You would uh submit a debt certificate. Uh depending on certain states they require some additional documentation. Uh but then we would be able to recover that asset. And we also built into the customer dashboard really easy to access instruction sheets.
(11:40) So there's there's a button that you can click right there in your dashboard. It will give you a PDF that can be put in your file cabinet, you know, given to your beneficiaries or given to your lawyer or your trust attorney. And what it what it just it shortcuts the path to the recovery.
(12:00) So it explains that this client, this individual has an account at Anchorwatch. It explains who Ankoratch is. It shares our license numbers, uh, three different forms of contact information, and just clarifies to whomever is going to be, uh, kicking off that protocol that you don't need to file an insurance claim.
(12:18) This isn't an insurance claim, and it just takes them right through that and makes it super easy. So, uh, the attorneys who have looked at it, very happy with it. Um, and it's also flexible in terms of, uh, the trusts themselves. So some people already have a revocable or irrevocable trust. We can ensure uh that that trust itself can be the client.
(12:43) Um or we have other people who the individual is the client but they have a trust set up and if they pass away the trust is the beneficiary. And so any of those are doable with us. We we're happy to be flexible uh on that structure. Yeah. And it's it's massive because I've had many conversations with estate planners and attorneys on this show throughout the years.
(13:03) And the inheritance thing is always always uh just a headache in terms of it's typically the the gets put on the estate planners to sort of figure out and really walk through with the individual um how this is actually going to happen when they pass. And there is some trust involved in sense of like all right we're going to split up the keys and you have an attorney that has access to it.
(13:28) But if you can codify it and that's the beauty of what you guys are building and the beauty of Bitcoin more broadly is like as it matures you can codify it into like just a spending conditions on the protocol. Totally. Totally. I mean and yeah additional functionality will become available as well when we you know when we make the transition to tap routt but even today that you can set up the key management today uh you know between trustees for example or between the lawyers you can do that ahead of time if that was important to you but I think the most important thing in in this is just that
(14:07) your beneficiaries don't need to understand bitcoin like you can ensure that they will receive the bit benefit of your legacy without actually counting on them to understand key management uh or even know where things are. And I think that's a huge difference. It's a it's a really huge difference.
(14:30) Even collaborative custody, collaborative custody provides amazing back stops against a single point of failure. But for inheritance, it still assumes it still requires that the beneficiary have at least partial access uh to private key material uh and and can handle it well uh for a long long time. So, it's a big improvement, I think.
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(16:24) That's opportunitycost.app. Yeah. And I think one of the things that makes these conversations uh or the thought of just like inheritance planning around Bitcoin specifically so daunting is that it's it has been historically a pretty involved process of like literally setting up legal structures and um and processes with estate lawyers.
(16:52) I think in terms of the process of getting onboarded into Anchoratch's inheritance protocol, like what's what's the time look like from like all right, I'm going to do this to it's set up and we're good to go. I mean, uh, from the point in time that somebody reaches out to us and they're interested to become a customer to having an insured vault with the inheritance protocol set up is less than a week.
(17:17) And really that that time frame is just mainly to send them their signing devices because they set up their private keys themselves on brand new signing devices and so just the mail time. So a few days uh we would quote them, they fill out the application that's like a 15minute thing. Uh and then we'll send them the welcome kit that has the signing devices and some goodies.
(17:42) Uh and then it's just setting up an onboarding call uh and going through and creating their vault. During the application, that's when they provide their beneficiary and their secondary beneficiary and contact information for both. And then from there, everything about the inheritance protocol is just built into our services. We don't charge extra for it.
(18:00) If we do need to assist a beneficiary and recover it, we don't charge a finder fee or anything like that. This is just this is just part of our services and it's just built into everything that we do natively. Yeah. And I guess on top of that like since you guys have been out in market really hitting the pavement and uh telling people like hey you should be insuring your Bitcoin.
(18:27) We have always a London cover letter you can ensure against $5 wrench attack losing your private key which is also a big a big thing. Yeah. like how how would you describe the state of the market in terms of people understanding the importance of like ensuring your Bitcoin and really taking care of it? I think I mean it it's definitely coming along.
(18:53) We it it is better understood at the commercial level uh for sure. So commercial clients who already are buying insurance on other aspects of their business and are used to uh needing to secure insurance to provide comfort to others, right? So I mean if you think about directors and officers insurance for example um you know the company might buy that for themselves and and they are the customer of that insurance but really the reason that you do that is to give peace of mind to your your board members right so you wouldn't want to serve on a board if the company didn't have DNO in
(19:31) place and so this concept of of having insurance not only to protect yourself but to also protect other stakeholders is really important So fiduciaries, you know, fund managers, company business treasuries, Bitcoin treasury codes, uh they definitely are all seeing the the benefit and they see that having it insured, having in very secure custody, makes LPS feel better, makes investors feel better, makes regulators feel better. Um so that's definitely coming along on the individual side.
(20:06) Um uh I would say especially at the mid and higher level uh policy size where people are really thinking about wrench attacks um it's definitely hitting home. So I think this wrench attack thing in the you know over the last 6 months has been really intense like really really intense.
(20:30) They've been accelerating uh significantly. they're happening in the first world. Um, they're getting violent early. So, it used to be kidnappings in the first world anyway for recent history for the last decade or so, you know, a kidnapping would happen, a ransom situation would happen and it would take some time to actually build to violence.
(20:56) But recently, uh, over the last 6 months, they're going straight to violence. These are tactics that we're seeing more in like Central and South America. Cartel kidnappings where they would go straight to chopping off a finger, pulling out fingernails, things like that.
(21:13) Uh, and crypto crypto wrench attacks are going that direction right now. So, it's definitely on people's minds. And the other thing that's very interesting in terms of the reports is that if you look through the publicized reports, there's a lot more that happen that are not publicized, but if you look through the publicized reports, you'll see that the size of attack is less than you would expect. The ones that make the news are like 10 million, 20 million. They're significant dollars.
(21:39) But if you look at the people who are actually attacked, it's like husband and wife kidnapped and held in their home and tortured for $268,000 or $300,000. A guy was murdered, I think in December, for $58,000 of crypto. Uh, and so I think just having any amount and being public about it actually puts you at risk.
(22:06) And insurance really is the solution to that because you can have very clever key management and risk management concepts. You can have your passphrase, you can have decoy wallets, you can have multi-IG, but at the end of the day, if a gun gets pointed at your kid's head, uh generally uh you know, people people hand it over. And so insurance serves a really important purpose.
(22:29) It's it's really the only only backs stop. And even giving your keys to a custodian uh you know even that does not solve a problem. So I've I've talked to people who are like look I don't want the counterparty risk of a sole custodian. Uh that's you know the antithesis to my owning of Bitcoin. However I'm thinking about it because I just don't want that risk in my home.
(22:55) But the reality is, even if you don't hold your keys, wrench attacks are still are still a possibility because they can still just put the gun to your head and tell you to make a withdrawal. So, it it's a new paradigm. And I don't I don't even think I've mentioned this to you. We actually just started selling KN&R insurance. So, kidnap and ransom insurance.
(23:15) We're able to sell that as of last week. We'll start marketing it soon. Um, but it it's a different policy from our wrench attack policy, our custody policy and and so they they actually cover different aspects of this risk. So our anchor watch custody policy, if you're a customer, if your Bitcoin is forced to be sent, so gun is to your head or my head or coin corners, any heads, right? If the guns are pointed and the bitcoin moves as part of the theft, that is covered by our policy. So ours covers the loss of the asset itself. Whereas
(23:54) the KN&R policy covers a whole bunch of things, a lengthy list of uh coverages that are all specific to a kidnapping situation. So it covers the ransom uh which is different from losing the asset. So if instead of saying send us your Bitcoin, if they said your family has to gather $5 million and send it to us in whatever currency, that would be covered by KN&R.
(24:24) The most important thing, especially if you're a high-profile person, if you are known to be, you know, a Bitcoin holder, if you're public, if you're a company executive, uh the KN&R policy covers the hostage negotiators. Uh, and so that is actually very expensive and very important.
(24:48) So if you didn't have coverage, your first call would be to 911, right? That you know, my family member, my business partner was kidnapped. And then if you wanted to bring in professional hostage negotiators, you'd be like googling them and trying to vet them. And then they'd once you had chosen one, then they want you to wire them a retainer for their services.
(25:07) And so then you're not quite sure if you're even if they're good, if it's worth this money, and if they're even honest, and are you wiring money. So it totally removes that because uh our K&R policy is also backed by Lloyds of London. Uh and and so Lloyds and these these insurance syndicates have all the very best crisis response teams. So the the host hostage negotiators, they're all on retainer.
(25:31) And so as soon as a claim comes in, you've got that resource. it's working for you immediately. They're coordinating with law enforcement and so they're going to take over from there and resolve the situation. So, it's the cost of that, but more importantly, it's just having that service.
(25:51) And then there's a whole, you know, it also covers medical expenses, income loss, like you know, if you need time to recover after that event, mentally or physically. Uh it cover it, you know, if a murder happens, it covers things, you know, re regarding the recovery of the body, things like that. It's it's look, it's pretty morbid stuff, but I was going to say we're getting morbid here, but I know it's it's pretty it's pretty heavy, but it does actually provide all that coverage.
(26:18) And so they're they're good to go hand hand in hand uh alongside each other because they cover the full aspect of the risk. But that I mean look it is it is hitting home for a lot of people because these attacks are very frequent now. Um I think overall I'm not trying to fearmonger. I think overall like you know this is still a lowrisk or a low frequency situation. It's still very unlikely.
(26:47) Um, but it is accelerating significantly and because of starting to sell KN&R, we have additional visibility into attacks that don't make the press. Um, and there's a lot, right? There's if if you were a victim of one of these and it was resolved, right? Whether it was resolved with the person getting arrested and no money sent or it was resolved by a ransom having been paid and you walked away uh safely.
(27:18) Either way, there's a lot of people that if if that happened, you don't actually want it in the news, right? If you're able to keep it on the DL, you'll do so because it just invites more attention to you. So, there's a significant number, you know, for everyone that's reported, uh, there's a good handful that are not not reported. So, it's a real problem. Yeah.
(27:38) And I think the publicly available data I last heard cited a couple weeks ago was that up until mid June of this year, there was 30 public sort of ransom or kidnapping attempts and attacks on individuals to give up their their Bitcoin and crypto. And last year it was 30 for the whole year. For the whole year. Yeah.
(28:05) And then on top of it, then there's a whole a whole bunch more that are not on that list at all as well. And then I mean, and those are only really the first world ones or the ones that made Western media as well. And then there's an entirely whole separate thing of uh small dollar attacks that are happening you know that happen in poorer countries in Asia and Africa that those don't make the list at all but I think you know it it's it is a real problem and this year in particular has been a big uptick.
(28:41) Yeah, the France uh the France string was interesting because he had that guy in Morocco who was essentially he was young too. He's like 26 and he was uh contracting out kidnappers in France to go after all these people. He wasn't very good at it but didn't get away with a ton at the end of it. But yeah, I mean he he wre a lot of havoc for sure. Yeah, it's pretty crazy.
(29:06) It's uh a bit morbid and uh unnerving to talk about, but it's important to talk about. It's important that people are aware of these risks and the fact that there are ways to protect yourself against them or mitigate the risk and uh and we we try to do both, right? We're we're definitely trying to mitigate as much as we can just by being our client and the way that the keys are distributed. It would be really challenging to steal your Bitcoin.
(29:35) uh if you're an Anchor watch customer, you know, we have plenty of opportunities to slow down the process. We're a required signer. Even if uh there is a situation that we're aware of, we always have the opportunity to pull in law enforcement uh as soon as we're aware. So, you know, we can we can help to mitigate, but you know, we have to protect it from the other side, too.
(30:03) And the the other side is if it's successful, then it's covered by the insurance. And and that way if you're in that situation, you don't have to be trying to outsmart the people and try to outthink them. Like you really can just focus on keeping yourself safe and just understand that the Bitcoin, you know, it's not a risk of ruin. We've removed that particular risk.
(30:23) And so in that situation, you can simply focus on doing what you need to do to survive. to survive that event. Serious about your Bitcoin? Start acting like it. Unchain just launched the financial freedom bundle, a curated pack that includes a premium Bitcoin book, a new hardware wallet guide, and access to a private macro event with Tur de Mester, Legend. It's time to take control of your generational wealth.
(30:46) Go to unchained.com/tc to request yours. That's unchained.com/tc. Pretty hot package, freaks. Go pick it up. and transitioning to a less morbid but just as important I think for for your business. I mean like having been in the market now for as long as you guys have. I think one of the core thesis of of your business and why we're proud to back you and excited to back you at 1031 is like the diversification that you guys bring uh aloids of London and reinsurers in terms of the quality of the premium revenue and more importantly the uncorrelated nature of the premium revenue. Is that is that being validated
(31:34) in your mind? say what was that question is that that's being validated. Oh yeah. I mean I think uh it's it's a really cool thing about how we are fitting into traditional insurance. So I mean it insurance is a capital market. So the reinsurers or or the insurers they have their pool of capital their reserve capital and they can allocate it to really whomever they want.
(31:59) So it's like they have there's a pie of insurance dollars that can be set against whatever risks they want. And so a certain large portion of that pie is property insurance. Uh within that property insurance, there's a little sliver called specy. Uh species is uh kind of small weird things. So fine art and uh expensive jewelry, things like that.
(32:24) So most of our coverage falls within specy. And then there's crime as well. Uh that's also like internal crime and that's part of property as well. And so when Lloyds looks at us, we are a way to have access to a risk that is uncorrelated from the rest of the property bucket. So property is dominated by homeowners.
(32:52) uh especially in the last 5 to 6 years, homeowners is dominated by wildfires and hurricanes. And so you have these weather events or these fire events and they can have major wipeout years. And hurricanes in particular have have wre all sorts of havoc on the insurance industry.
(33:14) And so we can come in and we while there are risks of physical disasters causing a Bitcoin loss, it's very small, right? because of the way keys are distributed and we're a required signer. So really we we provide a completely uncorrelated uh pool of dollars that help them balance their own portfolios because they they have their own risk appetite. They have their own KPIs.
(33:39) And so we come in and we're just this very nice uh kind of uncorrelated pool of money that comes in and balances their own portfolio. And we hope that because our custody is so secure, uh, you know, we hope that we will continue to have low losses, um, and therefore the insurance industry will continue to see Bitcoin as a good risk to ensure.
(34:05) And what that will mean over time is that over time the costs will come down and the dollars will get bigger because they'll say, "Look, we're willing to open up a bigger sliver of pie for Bitcoin insurance." Uh, and that pie will get bigger, the cost will go down a bit because you've proven to us that the custody is very safe.
(34:30) And so we'll just continue getting more and more access to the capital markets that way. Yeah, I think it's there's a good sort of parallel to a disconnection in the market that exists right now in Bitcoin lending where if you do it in a way where you're not rehypothecating unchained Yep. has really led the way in terms of their collaborative custody. Bitcoin and escrow sits into multi-IG.
(34:58) you can audit it on chain and just the nature of Bitcoin as collateral despite how it's cussed and just run with the assumption it's not rehypothecated like it is literally uh the collateral is there if you're the lender and you need to recoup your principal because the borrower is not paying it back Bitcoin trades 24/7 365 sell get your principal back you're good uh very very little risk of losing your principal I think what you guys you're doing on the insurance side, it's like the same thing.
(35:30) Um, if you can ensure uh that you mitigate the risk of loss to a very small surface area due to the nature of how you guys are leveraging miniscript when people are um holding a policy with you it's like oh like this is relatively low risk like the cost of that capital should come down that I that's definitely our thesis. So we are already insuring private loans.
(35:54) So loans where an individual has negotiated a bitcoinbacked loans with their own bank. Uh we and the bank agreed to do it. They negotiated terms on their own, but the bank stipulated that they wanted the collateral insured. And so they ended up using us for insured custody and and we were able to do kind of a side letter to their loan agreement. And so that's already in place today.
(36:21) Um, and we do think over time though, you know, if if you have a a loan with uninsured collateral versus a loan with insured collateral, we think it will be bring down the cost of the of the loan for the borrower uh just because it gives a lot more peace of mind to the lender that in fact the collateral will stay safe.
(36:39) So, we're going to be offering that within our own platforms uh next year. So, in 2026, you can borrow against your Bitcoin in our platform. Uh but we're also talking to really the majority of the Bitcoin back loans uh in the space already.
(36:59) Uh so we announced that we'll be insuring uh Arch Lending uh a couple of weeks ago. So that will be coming out uh shortly uh soon this year talking to some of the other lending platforms. So I think this this idea is catching on very very well and and it's appealing to both borrowers and lenders. Nobody wants the collateral to disappear. the you know the benefit of the product disappears if you can't trust it and then I think you know we we always looked to the mortgage industry as an example and you know so banks will let you highly lever the the house itself highly lever um but they do have that
(37:34) rule that you have to have insurance you can't close on on a mortgage without the asset being insured if if you don't have insurance even for a day you can't close on the house. Um, and so we just view especially as banks come on that they will and I think they will uh start doing Bitcoin back loans themselves.
(38:00) I mean the broader PRFI banking I think they will uh but I do suspect they will actually stipulate that the collateral has to be insured. Um that's a little different from the the guidance that came out this week too. Uh which is was a cool cool development I think for Bitcoiners. Yeah. And this is this is going to sound weird to anybody listening to this, but like this is what gets me going.
(38:23) Uh because there's I I just hopped off of spaces earlier today and people are like, h like it doesn't seem like layer twos and all that are having that suess success that they should be. Like DeFi is not really materializing on top of Bitcoin. It's like listen, stuff's all interesting, cool. Like Lightning's awesome. It works. But let's be real, there's an order of operations to all this. uh Bitcoin's going to succeed.
(38:44) Number one, more people need to adopt it uh and come to the realization that I should be receiving receiving this as income or selling goods for it. And so like there's going to be a a period of time between now and when that is sort of widely uh the way people use Bitcoin um widely. Mhm.
(39:10) before that like we've talked about this many times off air but like and I think we've had many conversations about this with Ankoratch and the 1031 team like the next order of operations is Bitcoin as a collateral asset throughout the traditional financial system the bitcoinization of finance and a critical building block to enabling that and getting people comfortable with using Bitcoin as a pristine collateral asset in traditional financial products is insurance. And so like that's what I want to get through to anybody listening to this. Like
(39:45) talking about insurance uh may seem boring at times, may seem a little morbid at times, but if we're talking about like fundamental building blocks for actually integrating Bitcoin into the financial system, this is like a this is like a table stakes needs to be there, needs to be in the market and available to people.
(40:09) And I mean it does make sense, right? Like the idea of of using a high amount of leverage like right now like loans are very overcolateralized even that's that's a temporary I think right I think that's a temporary reality of the development of using Bitcoin as collateral.
(40:29) I think the those collateralization rates will come down, but insurance will help that I think because again like it it's fair that a lender wants to feel confident, right? Like that's that's a very reasonable uh a reasonable uh basis to start this discussion. And so having the insurance there actually just that is the way institutions gain confidence is is it removes the risk of a of a wipeout.
(40:54) Um, and I think, you know, the guidance this week from uh the FHFA that, you know, PY tweeted out the other day, you know, it's it's a step in that direction. It's that guidance was not about Bitcoin as collateral for a mortgage. It was about guidance on taking into account somebody's Bitcoin to determine if they are uh like their total assets and if they're a good if they're creditw worthy. Yeah.
(41:25) Yeah. Yeah. And so I mean I think it's a step in the right direction. Uh I think it's still up to individual banks and bank officers like I think it comes down to individuals uh how they actually put that bring that to life. But it's certainly it's certainly promising and and like I said, we've we've already done private loans where a bank officer was open to to viewing Bitcoin as collateral itself.
(41:49) Uh and we were able to help help out with that and make that happen for those customers who otherwise, you know, just would not have been able to get that deal done. And and by doing it, they're getting better rates than, you know, some of the some of the companies that are operating in the space specializing it.
(42:06) like if they had a really long-term relationship with their bank, they're getting good rates uh as long as the insurance is in place. Yeah, it makes sense. Like and it's great to see that there are individual bank officers out there willing to understand this and be like, "Okay, yeah, this makes a lot of sense." And I mean to that point, like going back to the LTV, too, like the LTV, I think it serves two purposes.
(42:30) one for the lender or the liquidity provider that's giving the cash to the lender like right this is a bit foreign to us like we need to have some asurances about like we want it over collateralized right their benefit and then the borrower's benefit too considering the historical price volatility of Bitcoin up to this point like I think people may not like it you need to put up $2 of Bitcoin to to get a dollar in a loan back but I think considering Yeah. The price volatility historically like that is a good buffer
(43:02) and like it's just like sort of guard rails for borrowers to make sure you don't get blown out. Totally. Totally. And yeah, I think it seems like on the borrower side, they're they're more than willing to do it right now. And you know, we'll see what happens with price action, too.
(43:19) Like I don't know where you are on on fouryear cycles versus are you a cycle guy or a slow I'm getting yelled at for for even mentioning the potential for a super cycle. So, I'm not going to say it. Oh, okay. Are you a super cycle guy? I make fun of super cycles. Yeah. I'm I'm I'm becoming more convinced that like it's just going to be a boring grind up into the right.
(43:42) So, that's I mean that seems to be the sentiment uh at the moment. I've always been pretty hardcore on like you follow the pattern until the pattern breaks. And right now we're still on a fouryear four-year pattern. But I will say if if we do transition to the slow grind up, I think it actually it does ease the the transition into Tradfi because it means that they can start modeling Bitcoin in a more predictable manner.
(44:12) And so things like LTV or the rates, you know, looking at how they view collateral, looking at at it in terms of your overall financial health. If Tradfi can actually say, look, you have this much Bitcoin, and sure there's some volatility, but we can trust that if you have this amount of Bitcoin, a year from now, you'll still have this amount of Bitcoin, or maybe it's going to be worth more.
(44:38) that's easier for them to stomach to understand to model uh you know at the aggregate for their own financial models than something that's having 80% draw downs. Um, so I mean I we'll we'll see what actually happens, but if it does transition to a slow grind up, I actually think it it enables faster transition of integration into financial products and then that slow grind turns into a hyper bitcoinization real quick when it's like oh why are we going but I mean kind of I mean going back like going back to like building blocks and table stakes for this to be enabled again like I think what you're building is critical to that what you and the
(45:13) team at Anchorwatch are building and then Like we were in DC last week. We're talking with Andrew Hones. Like if you think of like what they're doing at Battery, like if we I don't know if it's this cycle, next cycle, couple cycles from now, but you can squint and see if the traditional financial system.
(45:32) Obviously Andrew and the team at New Market who spun out battery, they're coming from the traditional financial system. They're pretty comfortable, very comfortable with Bitcoin as collateral. with that that like we're going back to like cycle theory discussions about what's happening like if that takes hold reaches a critical mass like you're taking Bitcoin off the market and holding it off for long durations and that's where you can get a liquidity profile and volatility profile that it makes sense for all this I love it. Yeah. Battery I mean battery and and what Andrew has built there and the team
(46:07) is one of my favorite. It really is. It's I I met them really when they were first launching, which was right around the same time we were launching as well. And so both our companies have kind of grown and uh been working through kind of this this hybrid Bitcoin Tradfi world.
(46:32) And so we end up, you know, at the same events and and speaking to the same people. So I've had the opportunity to watch them develop as we've grown as well. And I I just I'm a huge fan. I think it's a really clever It's very simple, right? Like it's a very simple blend of Bitcoin and and a traditional investable asset class, but it's one that benefits the individual or the business taking the loan.
(46:58) And obviously uh you know the the idea is that it will uh provide good returns both to them and to battery themselves. And I just think it's a very approachable way to pull capital in, get it, you know, long-term holders in a very approachable way that you don't have to be a maxi to understand the model and to be willing to take a step into Bitcoin adoption.
(47:21) Um, I'm yeah, I think it's I think it's great. And so, again, going to the price action and does that model work better on a a four-year cycle or a slow grind up? And I think on on that product in particular, I think it works either way. Um, you know, either way they can manage that product that benefits the the borrower uh in either scenario. It's cool. Yeah. Just extend your duration as long as possible.
(47:48) Capture totally stay in cycles, capture multiple cycles. But I mean to that point of um hitting the road and bumping elbows with the battery team at events that maybe don't cater exactly to Bitcoiners like what is your perception on the sort of acceptability as Bitcoin broadly in in the trady world as you've been I think it is changing rapidly to our benefit as Bitcoiners.
(48:21) Um, you know, I think the initial kind of steps into Tradfi were almost the DGEN side of TRDFI initially um, over the last few years. So, it was like the more aggressive hedge funds managers, right, would would have exposure, but now it really is it's becoming more conservative. um you know, bond obvious obviously bond traders uh are getting involved who were traditionally a a more conservative investment class pensions.
(48:57) Um but just talking to wealth managers, they're all their clients have Bitcoin. It was always kind of set aside uh just like as the part of their client's portfolios that they didn't actually touch or speak to. and now they're educating themselves. Um, they're not resistant. Uh, they're curious. Um, they're making plays.
(49:21) They're advocating to their own leadership to allow themselves to like interact with their clients about it. So, I think it's actually changing really quickly. Uh, like really quickly like in in this year alone. It's I feel like it's different now than it was at the beginning of the year. Yeah. Well, on the perception of stratified change, like that's one thing I think a lot of Bitcoiners have top of mind, particularly in the last year or two, whether it's strategy, the ETFs, the emergence of the treasury company in public uh markets mean that has been becoming a a fervor and you could see it
(49:58) turn into a mania as we as we head towards the end of the year. All these guys are cussying with uh single point of failure sort of uh custody solutions like Coinbase, Fidelity, whatever it may be. I mean, this is your pin tweet about like make sure you know like if someone that you're insured, make sure you understand what that actually means.
(50:23) We've talked about this before in the context of other exchanges that will market that your coins are are insured if if you're holding them. uh if you're custody with them, but it's really just a a small minority portion that's effectively uninsured. Yeah. And that's a pet peeve of mine obviously.
(50:42) But that's like there like to what we were saying earlier like you could imagine a scenario like drawing on the analog of mortgages where if you're going to begin to integrate this into the trady system like insurance is demanded by some of their stakeholders within some of these agreements and like could it actually be a forcing function to drive these larger institutions to more optimal custody setups like Anchorwatch? I I think so.
(51:13) So, historically, insurance just wasn't available or it wasn't cost-effective if if it was available and now it is. I think there's Ankorwatch has uh kind of one hurdle to get past to really uh become a viable option for a lot of companies and that's that we're becoming a qualified custodian. Um, so we talked to lots of of publicly traded companies and fiduciaries and they're like, I like the custody model a lot. It makes sense. Um, we need the insurance.
(51:45) I need that for sure, but are you a QC? And we were we were not. So, we are in the middle of that process and we will become uh a qualified custodian this fall. And then at that point I think what we will see is that we become the anchor watch is actually one of the top options for these Bitcoin treasury codes.
(52:08) The companies themselves the leaders of them they understand the risks of putting out a honeypot at an uninsured custodian sole custodian but they still do need to check the boxes. Uh the insurance is a way to set them apart. It helps them raise money uh because again it it makes the investors feel confident that it's safe.
(52:28) Um, and it just gets away from, you know, this. And look, one one inside bad actor. You know what what I fear is that a a bad actor will have gotten a job at a a large custodian and will spend years infiltrating their systems in to plan a large heist. And if you read the the fine print on the ETFs, you know, even the ETFs in their prospectus, they say that this is uninsured.
(53:00) Um, and effectively if the if the principle is lost, there's no recourse, right? That's that's not ideal, right? So yeah, we we view this uh in ourselves as actually the responsible alternative. And what we think will happen is once we have uh QC under our belt, I think what we'll see is something of fiduciary flight where if you're a fiduciary and you're responsible, how can you pay, you know, BIPS for uninsured custody versus maybe slightly more, not even a large amount more, but just slightly more for insured custody. If you're a fiduciary responsible for your client's funds, it
(53:40) it just doesn't make sense. and and in fact paying significant bips for uninsured custody uh you know even that you have questions on right because there is certainly a cost to maintaining a very secure system so I'm not saying it should be free I would it just it can't be like this is an expensive thing to maintain security at that level but once you have hit a certain infrastructure uh standpoint in terms of your costs then at that point.
(54:13) Storing private keys is is a low lift activity. It's a tiny piece of data, right? That you could store all the world's Bitcoin on Google uh Google Drive or AWS for like 20 bucks a year, right? So, it's not about it's not about size of the data. It's about security.
(54:37) And at some point paying BIPS just for the security of the platform, you know, I I think the market will push back on that um to a certain extent, but paying for insurance. Insurance you're actually securing the collateral. So that's why it is BIPS is because the more insurance you want, the more collateral that needs to sit in reserve there ready to cover financial obligations.
(55:03) And so you are actually accessing the capital market with when you buy insurance and you're you're purchasing that promise that guarantee of of being your fail safe. Yeah. That risk transfer. And to your point earlier like who's to say that having the insurance doesn't unlock some level of capital on the other side and you do the costbenefit analysis of like it's worth the bips because you're going to make x amount of money on the back end. You'll make more. Yeah. I think so. Yeah. seems like it could be a big market.
(55:30) It It does seem like it's going to be a big market. We uh we're excited about it, in fact. So, it's been it's been a fun it's been a fun year for us because a lot of things are happening that are the premises for why we built Anchor Watch, right? So, we are getting the enjoyment right now of of it's the satisfaction of having skated to where the puck was headed. Um and that feels it feels really good.
(56:00) It feels like all the work that we had done I mean even before launch right we were so heads down and building towards this vision of what we thought would be happening in two to 5 years and here we are a couple years later and and it's starting to happen. It's awesome. It's like it's just kind of things that we predicted and not us alone, but uh things that we felt strongly enough that it was worth leaving our careers and building a company for. Um you know, they're they're starting to happen. It's and I think it's going to keep happening
(56:30) and we're going to crush. It's going to be awesome. That's it's been completely gratifying to watch as you've been building this out over the course of the last three, four years. And uh what uh what people often worry about is like like you have two like when you build for this moment. Yeah. There's like two outcomes.
(56:50) It's like the dog that finally caught the car or like you built for this outcome so that you could sprint and it's been fun. I think you guys are squarely in the ladder sort of outcome which is like is not like you caught the car. It's like what do we do? It's like no we've been waiting for this like let's go and run. Yeah.
(57:08) And I mean, yeah, at this point it's like the car the car is getting to speed and we're we're right alongside it right now. And uh it's it's gonna get insane and uh you know, we're ready for it. We're ready for it. Like we were just off calls with Lloyds this morning um getting extra capacity. Uh, and I think, you know, just little anchor watch, startup Anchorwatch, we're going to double the amount of insurance capacity that's available to this industry, you know, in a year. That's that's crazy.
(57:40) Yeah, that's crazy. Like we And we did that through tech, by the way, right? like through really educating them on how we can uh diversify risk like we talked about earlier, but also diversify the risk of key management as well. And by giving them that confidence that hey, we can actually limit your losses meaningfully uh at the aggregate by the way that we do key management.
(58:13) you know, was the difference that made them unlock a huge pool of capital that previously wasn't available. Yeah. And what can um anybody who's listening to this, how do how do you think they should take action? Um what do you guys need right now? What would your message be to anybody listening to this? Yeah, I mean, look, I think we covered on a bunch of stuff, right? So, I think if you're an individual um and any of the earlier part of the conversation, whether it was kind of protecting yourself or from wrench attacks or inheritance, you know, we're happy to uh bring you on as a customer. You can reach out to me,
(58:45) Becca, at ankorwatch or you can sign up for a calendar event directly from our website at ankerwatch.com and we'll get you squared away. And if you're an institutional customer, if you're one of these larger players and you're trying to look down the road at your options, if you're diversifying custody, if you're trying to understand your custody options, uh your insurance options, I can also write custom policies.
(59:10) So, if you're a large if you're a large player and what I've described isn't exactly the insurance that you're looking for and you're looking for some other uh level of insurance coverage on your Bitcoin uh or the custody of your Bitcoin, you know, let me know and and for the right size clients, we can do that directly with Lloyd so we can get you a custom Lloyd's policy that's really oriented to your exact business.
(59:35) And we're always happy to talk to those people, too. So, just get in touch. I want to stress I'm trying to figure out like it's not boring to Becca and I. I'm sure sure insurance is a boring to many of you, but I I it cannot be overstated how important something like this is to unlock the wave of capital that gets comfortable with Bitcoin that many have been talking about.
(1:00:04) It's like a literal critical piece of infrastructure that enables all of this. So, I just want to thank you, Rob, the team at Anchorwatch for putting in the time. It's been a grind and like you said, you've been building for this moment.
(1:00:23) the moment is coming and uh I just couldn't be happier for you guys considering it watching you guys do this over the last few years and y um I know you're going through uh a bit of a personal battle right now and I think it would be remiss of me not to mention just how impressive you are individually um to do all this with what you're going through uh and doing of a class and strength that that uh I only wish I had.
(1:00:53) So, well, I'm at the I'm at the very beginning of it. So, uh I'm sure I will have my days here as we go into later in the summer and the fall where things are going to get a lot a lot tougher. Um but I today I feel good. Today I feel strong. Um, you know, hey, this is one of my last podcasts where I still have the hair. That's uh that's going soon.
(1:01:21) That's going a week from Friday, uh, is when that that will happen. So, I'll have my I'll have my moments for sure. Um, but the support of you and, you know, the 1031 team and just the Bitcoin community, uh, has been very transformational for me. uh really and and having having Anchorwatch the team is so good, they're so strong that there's there's really no impact to the business right now.
(1:01:50) Um and that will continue and so that gives me a lot of strength and having the opportunity to at times, you know, just be focused on work is wonderful. Uh I I'm I love Anchorwatch and I I love what I think like what you said, I I think we built it for a reason. I think it's going to improve adoption.
(1:02:11) Uh I think it brings more adoption and and liquidity to Bitcoin and the opportunity despite all this stuff going on to take a few hours and just focus on that is it's a good escape from it all and I'm I'm grateful to have it. So, well, we're all grateful for you. What you're building, Becca. Um this has been incredible. Thank you.
(1:02:36) Hey, it's scary to think about inheritance, insurance, wrench attacks, but you got to think about it if you're out there. I can tell you corporation, you got to think about it. So, go hit up Becca and the team at Anchorwatch. Start thinking about it if you haven't already. And um next, we'll we'll catch up.
(1:02:55) There's plenty that's going to happen between now, the end of the year, year. Next time uh next time we talk about how we uh we turn on the Bitcoin yield flywheel using insurance get really exciting then that's going to be that's going to be a big one. You know that that question is uh very controversial in the space.
(1:03:12) Where does the yield come from? Well, but I can tell you I can tell you right where it comes from. It comes from insurance premiums. So yeah, let's let's do that one next time. I would love to dive into that topic sometime soon. It is. It is literally the only thing that makes sense in terms of Bitcoin yield to me right now, but we'll dive we'll do a deep dive. All right, we'll we'll jump into that one. Thanks for having me.
(1:03:31) All right, peace and love, freaks. Freaks. Thank you for listening to the show. I hope you liked it. If you did like it, please make sure you subscribe, rate, review the show. It helps us out a lot. And also, if you like these conversations, I've come to realize that many people listen to the podcast.
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