On March 2, Xapo Bank announced a partnership with Lightspark, a company led by former Facebook crypto chief David Marcus. The partnership seeks to expand bitcoin and Lightning Network’s utility. Xapo said it is the first fully licenced private bank to offer payments through the Lightning Network.
Xapo has teamed up with Lightspark to integrate the Lightning Network, so its customers can now pay for modest expenditures of up to $100 with any merchant that accepts Lightning Network payments. Xapo also offers bank accounts in U.S. dollars that pay interest and plans to do the same for bitcoin soon. The CEO of Xapo, Seamus Rocca, thinks that the Lightning Network will help customers avoid long wait times and higher on-chain fees.
We are pleased to announce that we are the first bank to offer #LightningNetwork payments, through our partnership with @Lightspark.
Our members can now make faster, cheaper #bitcoin payments on the Xapo Bank app. Read more: https://t.co/Nu1AKgm2UT#XapoPrivateBank #blockchain pic.twitter.com/wryWUmIaIN
— Xapo Bank (@xapoprivatebank) March 2, 2023
According to Rocca, the average transaction confirmation time of one hour, coupled with potentially high fees during periods of high utilisation, renders the Bitcoin network unsuitable for minor daily payments such as grocery shopping. By integrating with the hyper-efficient Lightning Network, it claimed to be the first bank in the world to expedite this process and enable its members to make modest bitcoin purchases without first converting to USD.
Concurrently, Jack Dorsey’s payments company, Block, introduced a new Lightning Network service provider named “c=.” On its website, the c= venture states that it collaborates with wallets, enterprises, and Lightning nodes. During the Xapo-Lightspark announcement, Rocca noted that the demand for bitcoin payment integrations continues to rise “against a backdrop of hyperinflation, economic uncertainty, and political turmoil,” The chief executive officer of Xapo insisted, “We need integrations like this that open up access to bitcoin payments.”
Customers must have bitcoin (BTC) in their Xapo Bank App to use the Lightning Network. Then, users can use the application to detect a Lightning Network invoice and pay any merchant. Xapo explained that the network would assess a nominal fee for the transaction. The CEO and co-founder of Lightspark, David Marcus, said that Xapo was one of the company’s confidential beta collaborators.
Marcus exclaimed, “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.” The Lightning Network has a total capacity of 5,421.53 BTC at the time of writing.
