🇬🇮Xapo Bank: The Gibraltar Bank for Bitcoin and USD

Xapo Bank is a fully licensed Gibraltar bank built around one idea: keeping Bitcoin and US dollars under one roof, with real banking rails on the fiat side. It grew out of the bitcoin custodian founded by Wences Casares (established 2013, famous for its vaults, including one in a Swiss mountain) and was relaunched as a bank: Xapo Bank Limited holds a Gibraltar Financial Services Commission (GFSC) banking permission, while crypto asset services run through a sister entity, Xapo VASP Limited, a GFSC-regulated DLT Provider. Figures below are from xapobank.com and the GFSC register.

Concept

Xapo positions itself as a private bank for Bitcoin holders rather than a crypto exchange: an annual paid membership ($1,000/year) buys an account that combines interest-bearing BTC and USD balances, a global debit card, Bitcoin-backed credit lines, and access to stocks, ETFs and gold from the same app. Interest on USD and BTC savings is variable and paid daily in Bitcoin; the advertised “up to 4% APY” is the target of the separate BTC Credit Fund, an investment product outside the deposit guarantee. Unlike MSB/VASP constructs, and much like AMINA Bank in Switzerland, the foundation here is a genuine banking licence — but Xapo is retail-friendly: the entry ticket is a membership fee, not a professional-investor status.

The fiat side connects to SEPA, Faster Payments (UK), FedWire, FedACH and SWIFT; stablecoins (USDC, USDT) work as an additional deposit and withdrawal rail. That places Xapo among the crypto-to-fiat bridges discussed on our OTC page, with the difference that here the counterparty is a deposit-taking bank.

Key parameters

Products: BTC plus USD in one account

The core product is a hybrid balance. Bitcoin sits in institutional-grade custody (vaults, MPC technology) via Xapo VASP; USD, GBP and EUR sit in the bank. USD and BTC savings balances earn variable interest paid daily in Bitcoin: the USD Savings base rate is 4.1% APY and BTC Savings pays 0.25% APY on the first 2 BTC; Xapo may change both rates at any time. The “up to 4% APY” figure belongs to the BTC Credit Fund — a targeted, non-guaranteed return on an investment product that is not a deposit, falls outside the deposit guarantee and requires a minimum of the BTC equivalent of USD 120,000.

Around the balance: a zero-FX debit card, Bitcoin exchange with the spread built into the quoted price (0.29% under the fee schedule, changeable without notice), USDC/USDT deposits and withdrawals, exposure to stocks, ETFs and gold from the in-app investment dashboard, Bitcoin-backed credit lines (draw and repay flexibly without selling BTC; currently unavailable to residents of the UK and Australia), and an inheritance service for passing BTC to heirs. By Xapo's own figures, its capital ratio is 167% and its liquidity ratio 1663%.

Licence and protection of funds

Xapo Bank Limited is authorised by the GFSC under the Financial Services Act 2019 as a credit institution (Permission No. 23171), with permissions spanning accepting deposits, payment services, e-money issuance and FX, plus MiFID permissions: reception and transmission of orders in transferable securities, and order execution and safekeeping for fund units, which the register restricts to the Xapo Byzantine BTC Credit Fund. This is verifiable in the GFSC register.

The division of labour matters: fiat deposits sit with the bank and are covered by the Gibraltar Deposit Guarantee Scheme up to £120,000, while all crypto asset services are provided by Xapo VASP Limited (DLT Provider, Permission No. 26061) — and crypto deposits are explicitly not covered by the guarantee scheme. For BTC, protection rests on the custody architecture (vaults, MPC, SOC 2 Type II audits), comparable in spirit to bank-grade custody such as FV Bank.

Onboarding

Onboarding is fully remote through the app: an ID or passport, personal details and security setup, followed by compliance checks: proof of address before the account opens and source-of-funds checks notified through the app or by email. Membership costs $1,000 per year, payable in fiat, stablecoins or BTC, with a full refund within 30 days of account activation, in which case the account is closed; a $500 referral credit per successful invite exists. Savings have no minimum deposit; interest accrues from USD 20 or a small BTC minimum.

Availability depends on the country: an applicant whose country is absent from the application's country list cannot proceed, and Xapo's terms (cl. 6.12) let it designate further prohibited jurisdictions by location, citizenship or residence. Xapo's legal notice excludes US persons (US residents, and partnerships or corporations organised under US law). For Russia, the crypto feature is unavailable and USD transactions via ACH are not supported for Russian passport holders or residents; both are Xapo policies.

Compliance context

A Gibraltar banking licence means bank-grade AML: source of funds questions arise at onboarding and on larger crypto inflows, including chain-history analysis for BTC arriving from outside. The perimeter is the same as described on the OTC page: a clean, documented asset origin makes both onboarding and day-to-day operations predictable. The dedicated Relationship Manager included with membership is a practical channel for pre-clearing unusual transfers.

Who it suits

Xapo fits long-term Bitcoin holders who want their BTC inside a regulated banking perimeter with fiat rails attached: interest paid in BTC, a spending card, credit against the stack instead of selling. It suits internationally mobile clients whose country is on Xapo's application list and whose source of funds is clean. It does not suit US persons (not accepted), UK or Australian residents who need lending (unavailable), active traders optimising for exchange-level fees, or anyone unwilling to pay $1,000/year for the perimeter. For professional-only, multi-hub private banking, compare AMINA Bank; for US-linked custody needs, see FV Bank.