Coinbase has completed the purchase of Xapo, the cryptocurrency custody service best known for storing its crypto in a bunker deep inside a granite mountain in Switzerland. The deal, which was first mooted in May, has now concluded, making Coinbase’s custody option probably the most secure in the world. The completion of the deal comes just ten days after crypto investment giant Grayscale moved $2.7 billion worth of crypto over to Coinbase Custody, crypto that may well have now joined its cousins under millions of tons of Swiss rock.
1/ Today, Coinbase Custody has completed an acquisition of Xapo’s institutional businesses. With over $7 billion in assets, we’re now the most popular place for institutions to store cryptocurrency. Read more here https://t.co/bL3oj1Pyfl
— Coinbase Custody (@CoinbaseCustody) August 16, 2019
Coinbase Wins Out
Xapo was launched in 2013 with the aim of giving “users from all over the world the ability to send, receive, spend and store their money, globally and safely” and has since grown to encompass a 250-strong workforce and customers in over 50 countries. The Coinbase deal that Coinbase now has some $7 billion of crypto AUM, with over half a million BTC in its coffers. According to Fortune, Fidelity were among the other contenders in the running for the Xapo contract but Coinbase was judged a more superior offering in terms of security and regulations, undoubtedly aided by its seven years in the industry.
Coinbase Eyes More Bitcoin
In a blog post announcing the acquisition, Coinbase acknowledged Xapo’s part in advancing crypto custody solutions, adding that they would continue to hold the torch for next level in crypto security:
Xapo has long been a pioneer in the storage of crypto assets, leading the industry in the creation of security techniques that have kept their customers’ cryptocurrency safe since 2014. Xapo was founded with the mission of making Bitcoin more secure and accessible. Coinbase will extend Xapo’s legacy and bring it yet another step closer to achieving its mission.
According to Fortune, while the majority of Xapo’s largest clients have agreed to move their assets to Coinbase, some still remain, owning some $3.5 billion worth of crypto between them. If Coinbase can sign up these last customers they will be custodians of over 860,000 BTC, almost 5% of all the BTC in circulation.