By
Bhushan Akolkar
May 7th, 2024
Growing demand for Bitcoin cold storage leads to extreme popularity of Xapo’s services: the company holds 7% of the total Bitcoin supply.
Bitcoin storage provider Xapo is said to hold over 7% of the world’s Bitcoin supply in its vaults. The total value of the Bitcoin stored by Xapo amounted to $10 bln.
This information was provided by two unnamed clients of Xapo. And another person who is close to the company confirmed that this information contains the accurate figure.
Nevertheless, given the fact of the high volatility of the cryptocurrency market and unsteady Bitcoin price, it is necessary to highlight that estimated value of the coins stored is constantly changing.
Being established in 2014 by Argentine entrepreneur Wences Casares, Xapo made news when the startup began storing Bitcoin in a mountainside vault in Switzerland having converted a decommissioned military bunker into a crypto storage facility last year.
Earlier, Xapo relocated its headquarters from the US to Switzerland with a view to provide enhanced privacy protection for its clients.
Currently, the startup owns an extended network of underground vaults on five continents. Xapo holds funds of both private and institutional investors. The client list of Xapo includes a number of well-known families’ surnames and names of huge firms and corporations.
For example, it has become known that a UK-based investment products and research firm CoinShares has deposited more than $500 million of Bitcoin at Xapo.
Ryan Radloff from CoinShares told Bloomberg that “everyone who isn’t keeping keys themselves is keeping them with Xapo”. “You couldn’t pay me to keep it with a bank,” added he.
The main rule for all Bitcoin owners is to ensure secure keeping of a private key that is a special code that enables people to spend their coins. In case intruders receive it, you can say “goodbye” to your holdings, there won’t be any chances to recover them.
Though it is rather convenient to keep these keys on devices that have internet access, it is really risky as hackers may get your secret codes.
There is another solution – to keep these keys in offline devices like thumb drives. But it is also quite dangerous as intruders can find ways to receive access to your private details.
Xapo has decided to bury a cold-storage device in a mountainside and layer on electronic safeguards. If you keep your holdings at Xapo and you want to take Bitcoin from the vault, it will take you nearly two days.
Bitcoin storage provider needs to verify your identity and to check your request. It is needed to get approvals from three separate vaults for any transaction to be permitted.
Xapo also provides its clients with a trading desk where they can purchase and trade Bitcoin. Moreover, the company has created the first Bitcoin debit card with the help of which you can spend your Bitcoins.
Currently, Xapo’s services boast popularity and rather high demand that can be proved by the fact that 7% of the global Bitcoin supply is kept by the company. It means that Xapo have more deposits than 98% of 5,670 banks in the US.