Xapo Bank has made a groundbreaking move by becoming the first licensed bank in the United Kingdom to offer a unique interest-bearing USD and bitcoin account. This innovative offering is a significant milestone for the bank as it expands its services into the UK market with the successful passporting of its banking license. Xapo Bank, a Gibraltar-licensed digital banking institution specializing in cryptocurrency, has positioned itself as a pioneer in the realm of digital financial services.
Xapo Bank’s Unparalleled Offering
Xapo Bank’s latest offering allows users to seamlessly send up to £1 million GBP directly to UK-based wallets and bank accounts, with services available 24/7. The CEO of Xapo Bank, Seamus Rocca, expressed pride in the bank’s achievement of passporting its banking license into the UK market, highlighting the rigorous regulatory standards met by the institution.
“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.”
Established in 2013, Xapo Bank has evolved from a bitcoin wallet service to a comprehensive digital retail bank and Virtual Asset Service Provider (VASP) custodian. The bank offers a secure environment for USD deposits up to the equivalent of €100,000, ensuring a level of security comparable to traditional financial institutions.
One of the standout features of Xapo Bank’s offerings is the bitcoin account that provides 1% interest without the need for staking, lending, or asset lockups. Members can leverage bitcoin through a widely accepted debit card, invest in S&P 500 stocks, or dabble in select cryptocurrencies. Furthermore, the bank has seamlessly integrated stablecoin payment rails with USD bank accounts, bridging the gap between conventional banking and digital asset services.
Joey Garcia, Director and Head of Regulatory and Public Affairs at Xapo Bank, commended the UK for emerging as a hub for cryptocurrency innovation, acknowledging its robust regulatory framework, dynamic financial ecosystem, and talent-rich environment.
crypto Market in a State of Flux
Xapo Bank’s successful foray into the UK market coincides with a turbulent period for the broader cryptocurrency industry. Recent market fluctuations have seen bitcoin plummet to $50,000, its lowest level since February 2024. Major cryptocurrencies like ethereum (ETH), binance coin (BNB), Cardano (ADA), and Solana (SOL) have also witnessed significant declines of around 15% in the past day.
The digital asset investment landscape experienced a notable outflow of $528 million last week, signaling the first downturn in four weeks. This exodus is attributed to mounting concerns surrounding a potential recession in the United States, exacerbated by geopolitical uncertainties and subsequent widespread liquidations across various asset classes.
The decision by the Bank of Japan 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 in risk-on asset markets, prompting extensive sell-offs. Furthermore, 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.