Xapo Bank has become the first licensed bank in the United Kingdom to offer a combined interest-bearing USD and Bitcoin (BTC) account.
The offering comes as part of the bank’s expansion into the UK, facilitated by the successful passporting of its banking license, according to a recent report from Finance Magnates.
Xapo Bank is a Gibraltar-licensed digital banking institution specializing in cryptocurrency.
Xapo Bank’s Unique Offering
Xapo Bank’s new offering allows users to send up to £1 million GBP directly to UK-based wallets and bank accounts, with services available around the clock.
“We’re proud to announce we have successfully passported our banking license into the UK,” Seamus Rocca, CEO of Xapo Bank, said.
“This means we are allowed to offer our banking services directly to the UK market. Achieving this is no easy feat and shows we meet the UK’s high regulatory standards.”
Founded in 2013, Xapo Bank has transitioned from a Bitcoin wallet service to a comprehensive digital retail bank and Virtual Asset Service Provider (VASP) custodian.
The bank guarantees USD deposits up to the equivalent of €100,000, providing a security level comparable to traditional banking institutions.
JUST IN: XAPO BANK REPORTEDLY BECOMES THE FIRST UK BANK TO OFFER INTEREST-BEARING BITCOIN ACCOUNTS
— BSCN Headlines (@BSCNheadlines) August 5, 2024
One of the standout features of Xapo Bank’s offerings is a Bitcoin account that provides 1% interest without requiring staking, lending, or asset lockups.
Members can utilize Bitcoin through a universally accepted debit card, invest in S&P 500 stocks, or purchase select cryptocurrencies.
Additionally, the bank integrates stablecoin payment rails with USD bank accounts, effectively bridging traditional banking and digital asset services.
“The UK is swiftly emerging as a global hub for cryptocurrency innovation, boasting a promising regulatory framework, a dynamic financial ecosystem, and a talent-rich environment,” Joey Garcia, Director and Head of Regulatory and Public Affairs at Xapo Bank, said.
Crypto Market in Turmoil
Xapo’s successful entry into the UK market comes at a tumultuous time for the broader crypto industry.
On Monday, Bitcoin plummeted to $50,000, marking its lowest level since February 2024.
Other major cryptocurrencies also suffered significant losses.
Ethereum (ETH), Binance Coin (BNB), Cardano (ADA), and Solana (SOL) have all declined by around 15% over the past day.
As reported, digital asset investment products saw outflows amounting to $528 million last week, marking the first downturn in four weeks.
The exodus is believed to be a response to mounting concerns over a potential recession in the United States, compounded by geopolitical uncertainties and consequent widespread liquidations across various asset classes.
For one, the Bank of Japan’s (BOJ) decision to raise interest rates for the first time in 17 years due to concerns over the Yen’s purchasing power decline against the US Dollar has triggered apprehension within risk-on asset markets, prompting widespread sell-offs.
Additionally, escalating tensions in the Middle East, particularly between Israel and neighboring nations, have added to the prevailing market unease, with fears of further escalation prompting precautionary measures among concerned countries.
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