Xapo Bank, a Bitcoin BTC 4.56% custodian and licensed private bank, has partnered with Circle to become the first licensed bank in the world to integrate the USDC payment rail as an alternative to SWIFT.
By adding outrails to its existing USDC on-ramp, Xapo Bank is enabling members to bypass costly and time-consuming SWIFT payments and instead use the stablecoin to deposit and withdraw funds at no bank fee.
The bank offers a 1:1 exchange rate between USDC and US dollars, and all USDC deposits are automatically converted to US dollars, which means that members can enjoy a 4.1% annual interest rate on deposits.
Xapo Bank’s move to support USDC deposits and withdrawals marks a major step in the adoption of stablecoins by traditional banking. As the world becomes increasingly digital, traditional banks are looking for ways to simplify operations and reduce costs, and stablecoins offer a compelling alternative to the traditional SWIFT payment system.
With its fully licensed status, Xapo Bank is well positioned to lead the way in this new era of banking. Clients of the bank can now benefit from faster, cheaper, and more efficient transactions, with the added benefit of earning interest on deposits, and Xapo Bank’s support for USDC deposits and withdrawals is sure to be welcomed by its members.
The move also underscores the growing importance of stablecoins in the cryptocurrency space. As the cryptocurrency market continues to mature, stablecoins are becoming an increasingly important tool for traders and investors looking to avoid the volatility of other cryptocurrencies.
With Xapo Bank supporting USDC deposits and withdrawals, stablecoins are likely to see wider use in the coming years.
