Well known for storing bitcoin in vaults in the Swiss Alps, Xapo allows users to transfer funds to and from its vault through a mobile app or online interface.
The firm’s debit card is not prepaid like many other crypto debit cards, but instead links directly to a customer’s Xapo hot wallet. On Xapo’s platform, bitcoin transfers to external accounts don’t incur additional charges beyond miner fees, and there are no fees at all for transactions between Xapo accounts.
Xapo was created after Casares first acquired bitcoin in 2011 and created a vault in which to store it. Upon receiving requests from his friends, and later institutions, asking to store their bitcoin in his vault, he decided to found the company.
In 2014, Xapo received Series A funding of $40 million from investors including PayPal cofounder Max Levchin, Yahoo CEO Jerry Yang, Index Ventures and Benchmark Capital. At the time, this was a record-breaking funding round in the crypto industry. The company’s institutional business was acquired by crypto exchange Coinbase for a reported $55 million in 2019.
In 2018, the New York Department of Financial Services (NYDFS) granted Xapo a BitLicense allowing the firm to offer its wallet and vault services to New York residents.
Xapo officially relocated its corporate headquarters to Zurich, Switzerland, in 2015 saying it was seeking to enhance users’ privacy and other protections.
Prior to its acquisition by Coinbase, Xapo’s clients included Grayscale Investments, a subsidiary of CoinDesk parent firm Digital Currency Group (DCG), which manages multiple crypto investment trusts. The company’s advisors include Clinton administration treasury secretary Lawrence H. Summers, Visa founder Dee Hock and former chairman and CEO of Citibank John Reed.