2 years ago
Coinbase-owned Xapo slope announced its integration with the Bitcoin (BTC) Lightning Network connected March 2, becoming the archetypal fully-licensed slope integrated with the Lightning Network.
This integration came astatine a clip erstwhile 2 starring crypto banks – Silvergate and Signature- were experiencing troubles with their operations. Considering the existent concern successful the crypto banking sector, Xapo’s integration tin beryllium perceived arsenic a objection of the bank’s bullish sentiment towards the field.
Xapo connected Lightning Network
Xapo was founded successful 2013 arsenic a wallet and a acold retention custody vault. In 2021, it became the archetypal institution that held BTC ever to unafraid a banking license, thereby becoming a bank. Crypto speech Coinbase’s custody arm, Coinbase Custody, purchased Xapo successful 2019. At the time, Xapo had astir $7 cardinal nether custody, which made Coinbase Custody the largest crypto custodian successful the world.
To motorboat the integration, Xapo partnered with Lightspark, a institution that offers infrastructure services for companies that privation to integrate with the Lightning Network.
The integration allows Xapo slope users to wage for purchases up to $100 utilizing BTC astatine immoderate vendor that accepts Lightning Network payments. Considering the important improvements the Lightning Network brings successful presumption of velocity and affordability, Xapo takes pridefulness successful being the archetypal afloat licensed slope that offers near-instant BTC payments.
Commenting connected the integration, Xapo Bank CEO Seamus Rocca said:
“The mean transaction confirmation clip of 1 hr combined with perchance ample fees during periods of precocious usage marque the Bitcoin web unsuitable for tiny regular payments specified arsenic groceries.
By integrating with the hyper-efficient Lightning Network, we are the archetypal slope successful the satellite to streamline this process and let our members to wage for tiny purchases with Bitcoin without having to person to USD first.”
Turmoil successful the crypto banking sector
Silvergate and Signature Banks person been experiencing troubles since the FTX collapse, and it seems similar things are getting worse for them.
Silvergate
On March 8, Silvergate Bank announced it would halt banking operations per regulations. The travel that led Silvergate to halt its concern started connected March 1, erstwhile the slope said it’d hold submitting its yearly 10-K study by 2 weeks. Silvergate shares reacted to this by signaling a 32% autumn during the pursuing hours.
While announcing the hold of the 10-K report, the slope besides said it has been facing inquiries from the regulators astir its narration with the failed speech FTX. Upon this news, respective companies that were moving with Silvergate chopped their ties with the bank. Even though Silvergate has been plotting a associated betterment program with the Federal Deposit Insurance Corporation, it inactive decided to halt its operations.
Signature
Signature bank’s problems started successful September 2022, months aft the FTX collapse. Signature’s mid-Q3 study disclosed that the slope mislaid $4.27 cardinal successful outflows “driven by the caller crypto winter.”
In December, the slope decided to alteration its outlook and announced it would shrink its crypto-tied deposits by $8 to $10 billion. With the announcement, the slope stated it was “not conscionable a crypto bank” and wanted to “come crossed large and clear.” In January, Signature announced different update to its crypto transactions and introduced a $100,000 minimum transaction limit.
Even though Signature was keen connected changing its outlook to “not conscionable a crypto bank,” it came forward with its crypto services during the downfall of Silvergate. It is presently serving aggregate crypto companies.
The station Xapo slope integrates Lightning Network arsenic Bitcoin banking assemblage successful turmoil appeared archetypal connected CryptoSlate.
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