Xapo Bank Expands its Stablecoin Payment Rails, Becoming The First Licensed Bank To Enable Tether Deposits and Withdrawals
Xapo Bank highlights strong appetite since enabling USDC deposits in November, receiving $48 Million in USDC deposits and enabling $4.5M in USDC withdrawals since the function went live in March*
BANGKOK, THAILAND - Media OutReach - 16 May 2023 - Xapo Bank, a fully licensed private bank that combines traditional banking with access to Bitcoin and stablecoins, has become the first bank in the world to integrate Tether (USDT) payment rails. Beginning with a phased roll out, the payment rails will be fully available to all members by the end of the month. Building on its existing USDC rails that were launched in March, the bank is now enabling members to leverage the world’s most widely adopted stablecoin for payments as an alternative to time-consuming and costly SWIFT rails.
With a market cap of $82 billion USD**, USDT is the world’s most used
stablecoin and one of the most traded cryptocurrencies by volume, having
pioneered the digital dollar concept. It empowers growing ventures and
innovation throughout the blockchain space, providing a quicker and more
efficient way for millions of people across the globe to send and
receive money for remittances and other payments. It is also
particularly
popular in emerging markets suffering from hyperinflation and economic uncertainty.
Xapo Bank has seen a strong appetite for the efficiency of stablecoin
deposits and withdrawals amongst its members, many of whom are based in
emerging markets. Since enabling USDC deposits in November, it has
received $48 Million in USDC deposits and enabled $4.5M in USDC
withdrawals since the function went live in March. It has also
experienced a 19%*** increase in member onboarding requests since the
USDC withdrawal function went live in March.
By allowing members to deposit and withdraw using USDT with no fees
charged, Xapo Bank is bringing its attractive 4.1% annual interest rate
return on deposits to the attention of a new cohort of potential members
looking for an alternative to SWIFT payments. Similarly to its USDC
offering, Xapo Bank offers a 1:1 conversion rate from USDT to USD. All
USDT deposits received by Xapo Bank are automatically converted to USD,
meaning that members can benefit from a 4.1% annual interest rate on USD
deposits.
A fully licensed and regulated bank, Xapo Bank is a member of the
Gibraltar Deposit Guarantee Scheme, meaning that Xapo Bank guarantees
its members’ USD deposits up to the US dollar equivalent of €100,000.
Xapo Bank does not take any risks with deposits received using USDT. All
such deposits are automatically converted to USD and deposited into the
member's account. Unlike traditional banks, Xapo Bank does not lend and
therefore does not rely on fractional reserve banking to make money as
its core business model. Instead, it has all its customers' funds in
reserve and invested in short-term liquid assets to pass the benefit of
that interest earned to its customers.
Seamus Rocca, CEO of Xapo Bank, said:
“Xapo Bank is the only regulated bank in the world which offers a USD
account with stablecoin rails. This unique offering combines the
compliance and safety of a traditional bank with the speed, efficiency
and breadth of use of USDT. By growing our payment rail options, we are
committed to eliminating the timely and often expensive deposit and
withdrawal processes into regular banks. We are empowering our members
to grow their wealth and access and spend it seamlessly.”
Xapo Bank is constantly striving to grow its payment rails options,
offering members additional currency choices managed with the security
of a fully-regulated Bank. Reflecting this, in addition to the USDC and
USDT payment rails, Xapo Bank previously integrated with the
Faster Payment System
(FPS) to activate support for GBP settlement for account deposits and
withdrawals. Earlier this month, it also announced an integration with
Bitcoin’s Lightning Network, in collaboration with Lightspark.
To learn more about Xapo Bank visit:
https://www.xapo.com/
Editor’s Notes
* Data collated w/c 25th April
** As of 9th May
*** Comparing the 45 days before the USDC launch and 45 days after the launch
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