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Xapo Private Bank, the only fully licensed private bank that accepts Bitcoin and USDC deposits, has partnered with Lightspark to integrate with the Lightning Network, enabling lightning-fast Bitcoin payments for its customers.
The integration with the Lightning Network will allow Xapo Private Bank members to instantly pay for small purchases of up to $100 at any vendor that accepts Lightning payments without suffering high transaction fees and long blockchain confirmation waiting times.
The Lightning Network enables scalable payments at millions of transactions per second across the network. This integration will reduce the time-consuming and costly experiences that often plague users who pay for small transactions in Bitcoin.
The average transaction confirmation time of one hour combined with potentially large fees during periods of high usage make the Bitcoin network unsuitable for small daily payments such as groceries.
“By integrating with the hyper-efficient Lightning Network, we are the first bank in the world to streamline this process and allow members to pay for small purchases with Bitcoin without having to convert to USD first,” says Seamus Rocca, CEO of Xapo Private Bank, based and regulated in Gibraltar.
“Against a backdrop of hyperinflation, economic uncertainty, and political turmoil, we are entering a world where digital money is ubiquitous, and we need integrations like this that open up access to Bitcoin payments. We are bringing together the benefits of fast, cost-efficient, and global Bitcoin payments with the security, privacy, and flexibility unmatched in the traditional banking industry,” adds Rocca.
David Marcus, CEO and co-founder of Lightspark, said: “We’re thrilled to enable the first bank on the Lightning Network to offer instant, cheap Bitcoin payments to its customers.
“Xapo has been one of our early closed beta partners, and we’re delighted they chose Lightspark’s enterprise-grade solution to reliably send and receive payments on the Lightning Network without all the complexity and operational overhead that typically comes with running a node on it. We look forward to talking more about our solution in the months to come.”
To pay via the Lightning Network, Xapo Private Bank members will need to hold Bitcoin in the Xapo Bank App. After that, they can simply scan and pay an invoice at any merchant that accepts Lightning Network payments.
The network charges a very small fee for each transaction, usually a few Satoshis. Xapo Bank has set a fixed payment fee for SAT 15 (less than $0.01 USD as of Feb 24th) to protect members from executing transactions with high fees.
Wences Casares, chairman at Xapo Bank, said: “We believe that Bitcoin is the future of money, and we are committed to helping our members navigate this new financial landscape. By expanding our services to include instant Bitcoin transfers, we can offer our members better usability and ultimately grow the cryptocurrency that many of our members rely on.”
The Lightning Network is a second-layer scaling solution for the Bitcoin blockchain that enables faster and cheaper transactions. It works by creating payment channels between users, allowing them to transact off-chain and settle their final balances on the Bitcoin blockchain.
Xapo Private Bank is one of the few fully licensed private banks that accept cryptocurrency deposits. It is based in Gibraltar and is regulated by the Gibraltar Financial Services Commission. In addition to Bitcoin and USDC deposits, Xapo Private Bank offers its members an annual interest rate of 4.1% on US dollars and will soon be offering up to 1% on Bitcoin, divided over the year and paid out daily.
The partnership with Lightspark and integration with the Lightning Network is another step forward for Xapo Private Bank in providing its members with the best possible cryptocurrency banking experience.