Risk outlook for digital assets in 2026

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The digital asset ecosystem continues to evolve and mature. Institutional adoption, tokenised real‑world assets, stablecoin rails, and mature decentralised finance (DeFi) protocols have expanded the terrain. At the same time, regulators are more active and complex interconnections between crypto and traditional finance are increasingly visible. For organisations and investors, that combination can potentially create an environment of significant opportunity and risk: efficiency, new liquidity pools, and programmable contracts on one hand, and novel and sometimes opaque vulnerabilities on the other.

1. Institutional adoption will continue to grow, bringing complexity and interdependence

The institutional embrace of digital assets has moved beyond experimentation. More banks, asset managers, and other financial entities are no longer asking whether to engage with digital assets, but how to do so strategically — whether through direct holdings, custody services, or partnerships with crypto-native platforms.

This institutional adoption is increasing demand for sophisticated insurance solutions. Institutions now not only seek insurance for their own digital asset exposures, they increasingly look to their counterparties to maintain insurance. The result is a cascading effect: both sides of every transaction seek protection, amplifying market demand while potentially introducing new challenges.

One area of complexity lies in managing concentration risk. The ecosystem’s reliance on a limited number of custody providers, protocols, and infrastructure layers creates potential points of systemic failure. The 2025 Balancer Protocol incident served as a reminder of how interconnected vulnerabilities can rapidly propagate across platforms.

While some risks, such as custodial risks associated with using a third-party custodian, may not be readily insurable due to aggregation concerns, others — like those related to computer fraud and smart contracts— can be covered alongside more traditional risks within crime policies. The evolving risk landscape means insurers and clients alike must carefully consider how insurance coverage is addressing them.

2. Regulatory maturation could fragment compliance

Regulatory clarity is expected to improve in 2026, but this progress comes with its own complications. While clearer frameworks reduce uncertainty and attract capital, they can also intensify scrutiny on operational controls and risk management practices.

A challenge is regulatory fragmentation. For example, the US GENIUS Act, Europe’s MiCA framework, and Hong Kong’s Stablecoins Ordinance, while sharing some similar features, represent differing approaches and requirements for market participants. For globally operating firms, compliance can act as a stress test for every operational dimension: governance structures, technical controls, reporting mechanisms, and insurance protection. Firms will benefit from demonstrating compliance, and also resilience of their compliance architecture across multiple jurisdictions.

Forward-thinking organisations will seek insurance partners who understand this multi-jurisdictional reality, as well as advisory services that help companies more effectively manage compliance risks.

3. Cybercrime risk evolution: From quantum threats to smart contract vulnerabilities

Cybercrime risk remains a dominant concern in the digital asset space. In 2025, it is estimated that approximately 200 crypto security incidents resulted in estimated losses of US$2.94 billion, including one of the largest cryptocurrency thefts in history.

In addition, the threat landscape is evolving. Quantum computers pose a significant threat to blockchain technology’s security. Authorities in the US, EU, and UK have issued guidance and transition roadmaps for post-quantum cryptography (PQC), with implementation deadlines as early as 2035. This reflects growing concerns about "harvest now, decrypt later" attacks, where adversaries collect encrypted data today for decryption once quantum computers become viable. Organisations should begin inventorying cryptographic dependencies and assessing vulnerabilities now.

Beyond quantum concerns, the traditional technology risk profile — including vulnerabilities in smart contracts, blockchain infrastructure, and emerging technologies — may continue to generate losses. In 2026, there will likely be a stronger focus on proactive and holistic risk management. Scenario analysis and risk frameworks are increasingly necessary for organisations to map potential failure points and develop targeted mitigation strategies.

Insurance products must evolve in parallel. Insurance policies that are reliant on generic technology categories may not meet organisations’ future needs. Dynamic solutions that reflect actual system architectures, threat models, and control environments will rely on collaboration between insurers and insureds in risk quantification and modeling.

4. Innovation in insurance products

As digital asset firms mature operationally, their insurance needs are becoming more sophisticated and specialised. Organisations are likely to be better served by tailored insurance solutions that address their unique risk profiles and business models.

Innovation, such as paying premiums in stablecoins, remains niche due to operational complexity, but more substantive product evolution is underway. The insurance industry is increasingly seeing combined offerings — for example, across traditional risk categories like cyber, crime, and professional liability —designed specifically for digital asset operations.

Beyond more traditional insurance products, there is also growing demand for other insurance lines, such as kidnap and ransom, which has seen increased demand in the crypto space due to high-profile incidents.

Leading insurance programmes in 2026 will aim to more effectively anticipate risk in addition to responding to it — with products that result from collaboration among insurers, brokers, and insureds, all of whom understand the technology, threats, and operational realities thoroughly.

5. Data and analytics as enablers for improved risk pricing

For years, insurance purchasing in the digital asset space has faced challenges due to the limited availability of loss data, making risk assessment difficult for underwriters and actuaries. At times, the underwriting approach reflected broad assumptions and a conservative approach to pricing.

In 2026, improved data collection, standardised reporting frameworks, and more sophisticated analytics can help insureds and brokers to present risks more clearly and effectively, and help insurers to improve their underwriting. These advances can, in turn, enable more strategic decisions around risk retention, transfer, and pricing.

This data evolution enables several critical capabilities: maximum probable loss modeling for specific scenarios, risk-adjusted pricing that can recognise strong controls, and more strategic insights into risk retention versus transfer decisions. Greater transparency should benefit all stakeholders — insurers can price risk more effectively, and insureds are better able to demonstrate sound risk management to secure better terms.

Preparing for the future of digital asset risk

The digital asset space is rapidly evolving, and organisations will benefit from a clear understanding of both the opportunities and risks.

At Marsh, we are committed to helping clients navigate these complexities. Organisations can benefit from a comprehensive suite of solutions spanning risk transfer, quantitative analysis, scenario analysis, and strategic advisory risk quantification services, all designed to support better informed decision-making across multiple time horizons and business lines. We support firms across the digital asset ecosystem, converting risk insights into advisory and insurance solutions better tailored to underlying exposures and growth trajectories.

As digital assets continue to mature in 2026, the organisations that succeed will likely be those that systematically embed risk management into strategy and operations. If you’re ready to explore how sophisticated insurance and risk management strategies can support your digital asset ambitions, we invite you to connect with our team.