Xapo Bank, a custodian of Bitcoin, as well as a licensed private bank, recently partnered with Circle– a financial technology company- in order to integrate the USD Coin payment rails.
This would be seen as a major alternative to SWIFT. The payment rails also referred to the technology and the infrastructure that would be used to facilitate the movement of funds between multiple parties within a financial transaction. The payment rails would also come in a multitude of forms- that would include traditional bank wires, blockchain-based platforms, as well as credit card networks.
Xapo Bank Will Partner With Circle To Facilitate USDC Movement
Xapo Bank has also stated that this new feature will allow the members to easily go through the cumbersome and extremely expensive SWIFT payment system through multiple outrails that were added to the existing USDC on-ramps. By utilization of the USDC stablecoin, multiple members would be able to deposit and further withdraw funds from the bank without benefit and fees from a one-to-one conversion rate from USDC to the US Dollar. Along with that, most of the USDC deposits are repeatedly converted to the American dollar- which will also enable members to start earning an annual interest rate return of around 4.1%.
According to this official announcement, Xapo Bank is a completely licensed and regulated bank- and is also a member of the Gibraltar Deposit Guarantee Scheme- which would protect the dollars of the depositors of around $100,000. Additionally, the bank also shared that it would not be engaging in the staking of any further cryptocurrency deposits- and all of the deposits will automatically be converted to the dollar- where the receipt is received by the bank.