Xapo is also expected to expand beyond Bitcoin by allowing customers to trade Ether.
Crypto-Friendly Bank zapo Has been granted a securities broker license that allows it to offer its European clients the ability to trade S&P 500 stocks like Apple alongside its crypto asset management offering. The Markets in Financial Instruments Directive (MiFID) license will enable the bank to expand beyond the speculative trading strategies used in crypto into long-term investment strategies.
Commenting on the news, Zappo CEO Seamus Rocca said in an interview,
“Our target customer is not your stereotypical 25-year-old Gen Z who wants to trade crypto […] This is a slightly older demographic that bought Bitcoin a few years ago to keep it as a pension pot, or perhaps to buy property when the price is right. They probably want a diversified portfolio with some stocks, a savings account that earns interest, as well as a Bitcoin allocation.
Xapo launched in 2013 with just one wallet, one cold-storage custody vault, and 30,000 Bitcoin cash. It then established itself as a Virtual Asset Service Provider (VASP) in Gibraltar. The bank has acquired banking licenses, major memberships with Visa and MasterCard, and membership in SWIFT – the global messaging system used by financial institutions to send information and money to each other. This allows the bank to connect directly with correspondent banks and gain access to money market accounts.
The Markets in Crypto Assets in Europe (MiCA) regime, which regulates crypto-asset issuance and service provision in the region, is attracting banks in the region. However, Xapo took a step away from promoting institutional crypto adoption with the sale of its enterprise custody business in 2017 coinbase, The firm instead decided to stick to retail investments and follow Bitcoin’s ‘financial freedom for all’ code.
“Banks are adopting crypto, but only for institutional services. Not for people like you and me. I think that’s where we were breaking the mold. “We could see the need to create a bank that combined crypto with everyday use cases because traditional banks weren’t going to do that,” Rocca said.
The CEO also commented on the growing demand and adoption of non-custodial wallets following the collapse of major crypto firms last year. He said:
“I think it’s a bad idea. People don’t keep cash in a suitcase with a four-digit PIN under their bed. Why would you do this with your Bitcoin? You can keep it in a laptop or pendrive, but it is risky. And when you want to transact with it, you have to cross the bridge of traditional financial services.
The executive also revealed that due to popular demand, Expo will soon expand beyond just Bitcoin by allowing customers to trade Ether. “So you will be able to store Ethereum and buy and sell it on Xapo, probably in about a month,” the CEO said.
Mercy Mutanya is a tech enthusiast, digital marketer, author and IT Business Management student. She enjoys reading, writing, doing crossword puzzles, and watching her favorite TV series.
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