Pioneering digital asset custodian and bank, Xapo Bank, has revealed it is now fully licensed to enable Bitcoin deposits through the Lightning Network.
Xapo Bank announced on May 23 that the development will enable its global custodians to deposit BTC using Lightning Network, a payments-focused Bitcoin Layer 2. It will run the transactions through Lightspark, a company that provides Lightning Network-based payment infrastructure.
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Xapo Bank Is Growing in Latin America
This latest development comes from the growing adoption rate in major Latin American markets, such as Argentina and Brazil.
“We believe in Lightning Network’s future as the primary avenue for Bitcoin transactions, especially for daily, small-scale exchanges,” revealed Xapo Bank CEO, Seamus Rocca.
According to the bank, the system offers near-zero transaction fees, also symbolizing a “leap forward in the Bitcoin technology.”
⚡️ #Bitcoin deposits simplified#BTC deposits through the #LightningNetwork are now available in the #XapoBank app! Skip the #blockchain fees and deposit up to $1,000 worth of Bitcoin per transaction in seconds.
Read more: https://t.co/KEu0XVyTD3 pic.twitter.com/qPwGkA307K
— Xapo Bank (@xapobankapp) May 23, 2024
The Gibraltar-headquartered bank added that the new Lightning Network deposit feature is available to all members and guarantees members’ USD deposits up to the US dollar equivalent of €100,000.
“By embracing this technology early on, we’re supporting its growth and ensuring that you benefit from its potential without sacrificing security,” said the company.
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Lightspark co-founder and CEO David Marcus highlighted the need to bring convenience to clients. “Today’s Bitcoin users seek not only to store their wealth but also to integrate Bitcoin into their daily transactions seamlessly,” he said.
The endorsement of instant bitcoin deposits enabled by a regulated bank marks a significant milestone in global bitcoin acceptance.
David Marcus
Coinbase Joins Xapo in Tapping into Lightspark
Approximately three weeks ago, the largest US centralized exchange, Coinbase tapped into Lightspark to launch support for Lightning Network payments. Coinbase’s move comes a year after Xapo Bank announced that it now supports Lightning Network.
According to Xapo, the market is increasingly warming up to the services. The number of Lightning Network payments made through Xapo jumped 44% from February through March this year. Argentinian and Brazilian users topped the list, accounting for 29% and 14% of the transactions, respectively.
According to Xapo, these countries have historically experienced high inflation, which boosts Bitcoin’s value proposition for local users. Look Into Bitcoin indicates that 4,868.2 BTC worth an estimated $337.7 million is currently locked on the Lightning Network.
Xapo Continues to Pioneer Bitcoin Services
Xapo was one of the first financial services providers to offer Bitcoin services to the Latin American market. Entrepreneur Wences Caseras, who also launched the first internet service provider in Argentina in 1994, founded Xapo Bank.
After his family was severely affected by inflation and tight capital controls in Argentina, he developed a keen interest in Bitcoin. The entrepreneur invested in BTC and built a vault to store his bitcoin, and this was the foundation for Xapo.
Later in 2012, he formed Lemon Bitcoin and Xapo in the following year, before Coinbase acquired the company’s institutional custody business in 2019. After the sale transaction with Coinbase, Xapo pivoted to solely service global retail customers.
In 2021, the bank became a fully licensed digital bank under the Gibraltar Financial Services Commission.
Cryptopolitan Reporting by Enacy Mapakame
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