Xapo Bank has integrated the Bitcoin-based Lightning Network and partnered with Lightspark, the venture helmed by former Facebook crypto lead David Marcus, adding another string to the bow of Xapo’s Gibraltar-licensed private bank and cryptocurrency custodian.

Users of Xapo Bank can now instantly pay for small purchases of up to $100 at any vendor accepting Lightning payments, without suffering high transaction fees and long blockchain confirmation waiting times, according to a press release.

The integration will also bridge the gap between traditional finance and crypto, which Xapo has been aiming to do. The Xapo Bank platform offers an annual interest rate of 4.1% on U.S. dollars in accounts, that are $100,000 deposit-guaranteed, and will soon be offering up to 1% on Bitcoin.

This is particularly important given the current regulatory pressure on crypto exchanges, yield-generating products and stablecoins. But it’s also about realizing a long-term plan to provide alternative banking possibilities in emerging market countries, explained Xapo CEO Seamus Rocca in an interview with CoinDesk.

Starting out with a wallet, cold-storage custody vault and reserve of 30,000 BTC back in 2013, Xapo later set up in Gibraltar under its virtual asset service provider framework. Sticking close to Bitcoin’s original ethos of financial freedom, Xapo took the decision to sell its institutional business to Coinbase in 2017 to focus on the retail space, Rocca said.

Since beginning the process in 2019, Xapo has been granted a banking license, obtained principal membership of Visa and Mastercard, as well as SWIFT membership. This means the firm can engage directly with correspondent banks, not via payment companies or third parties, and have access to money market accounts.

“We are now a fully fledged bank with a USD bank account, which we thought is most appealing to emerging markets,” Rocca said. “If you think about the U.S. and places like Europe, people are predominantly looking at crypto almost as a form of gambling. Whereas in places like Argentina, Venezuela, Lebanon, Nigeria, where currencies devalue and you can have hyperinflation, Bitcoin can change people’s lives.”