The crypto industry has spent years building increasingly sophisticated digital defenses. Multi-sig wallets, hardware devices, air-gapped signing. But there’s one attack vector that no amount of cryptography can solve: someone showing up at your door with a weapon and a bad attitude.
Bitsurance, a German insurance provider, is now offering coverage specifically designed to protect self-custody Bitcoin holders against physical threats. That includes fire, water damage, burglary, robbery, vandalism, and extortion, the last of which the industry has affectionately dubbed the “$5 wrench attack.” Standard coverage goes up to €100,000, with higher limits available on request.
Why physical attacks are the new frontier of Bitcoin theft
According to CertiK data, wrench attacks surged 75% year-over-year in 2025, with 72 documented incidents resulting in losses exceeding $40 million.
Traditional insurance products were never built for this. Your homeowner’s policy doesn’t cover the Bitcoin stored on a Ledger in your desk drawer. And custodial solutions, while they solve the physical risk problem, require surrendering the very thing that makes Bitcoin appealing to many holders: sovereignty over their own assets.
