Can I insure my digital art NFT (non-fungible token)?
Let’s say you’re the new owner of EVERYDAYS: THE FIRST 5000 DAYS by Mike Winkelmann, aka Beeple, which sold this past March for $69 million dollars. Congratulations, big spender! Unlike most luxury art, however, EVERYDAYS is an NFT, or non- fungible token. This means that it’s digital, but unique. There’s only one EVERYDAYS, and it only exists in the ether. But since it has no material footprint (unlike more traditional art), no one knows exactly how to protect an NFT from hackers and thieves.
While paintings and other highly valuable objects are often covered by specific policies, it’s harder to find reputable insurance for an NFT. In part, this is because NFTs are still pretty new; while the crypto world may have been banging on about them for the better part of the past decade, most of us are only just learning what they are.
The other reason NFT insurance is hard to come by has to do with the volatility of the market. Since a token’s value can crash overnight, the market itself isn’t particularly appealing to insurers, who like to be able to predict crashes and disasters in order to set their prices. That said, since the NFT market more than tripled in 2020, it’s likely that insurance options will pop up soon.
If you own Beeple’s masterpiece, your options might not be that much better than a password-protected flash drive, but this will probably change soon. And once you are able to purchase NFT insurance, you can, of course, add it to your Marble wallet, where you can easily keep all your policies organized.