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Xapo Review: Here’s What You Need To Know
- Easy To Use?
- Time Needed
Xapo is a Bitcoin wallet which is known for its sophisticated cold storage technology. But what functionality does this custodial wallet offer and is it a safe choice? I’ve created this honest Xapo review to tell you everything that you need to know about the Xapo wallet.
What Is Xapo?
Based in Hong Kong, Xapo is an easy-to-use Bitcoin wallet which can be accessed through a mobile app or online. The majority of funds are stored in deep cold storage vaults to maximise security, whilst a small amount remains in a web wallet for fast and easy access.
The CEO of Xapo is Wences Casares, whilst the president is Ted Rogers. Both are reputable entrepreneurs, giving us high levels of confidence in the platform.
A popular feature of Xapo is its Visa debit card, which allows users to make easy withdrawals and payments. However, it’s worth noting that this prepaid debit card is only available to users in certain countries.
What Can You Do With Xapo?
Xapo has a wide range of features that are enjoyed by its users. Some of the things that you can do with Xapo include:
- Store your Bitcoin securely.
- Send and receive Bitcoin.
- Take out a prepaid debit card which is linked to your Xapo wallet.
- Open a savings account.
- Rest assured in the knowledge that your Bitcoin is secure.
Pros And Cons Of Xapo
Before we take a closer look at the functionality of Xapo, let’s take a look at some of the pros and cons of this platform.
|✅ Easy To Use||❌ Data Can Be Slow/Inaccurate|
|✅ Convenient For Tracking Your Portfolio||❌ Recently Acquired By FTX|
|✅ Free To Use|
Advantages Of Xapo
There are many advantages of Xapo which are enjoyed by its users across the globe. Here are just a few of the advantages of Xapo.
Visa Debit Cards Available
One of the most popular features of Xapo is the prepaid Visa debit card. This debit card enables convenient withdrawals and payments from your Xapo wallet, as well as giving you cashback on your purchases. This prepaid debit card also enables you to spend in any currency with no added fees.
Xapo is ideal for beginners. Although the sign up process is slightly lengthy, you are guided through it clearly, with all requirements carefully explained. Not only that, but both the app and mobile browser are easy to use, making it a great option for beginners who are looking for a way to store their Bitcoin.
Multiple Payment Options
If you want to purchase Bitcoin through Xapo, you’ll need to fund your account. Xapo offers a surprisingly broad selection of payment methods for this. This includes bank transfer, credit or debit card, Bitcoin and e-money transfer services such as Netteller and Skrill. This means that you’ll find it easy to top up your account whenever you need to.
Deep Cold Storage
One of the biggest benefits of Xapo is its deep cold storage system. 97% of the company’s Bitcoin reserves are kept in deep cold storage. This means that the private keys for these Bitcoins are held on servers which have never been connected to the internet, providing the highest levels of security. The other 3% of Bitcoin reserves are held in hot wallets to enable fast and easy access to funds. This means that you benefit from high levels of security but also easy access to your funds when you need it.
Disadvantages Of Xapo
Although there are many advantages of Xapo, there are also a few disadvantages that you should be aware of. Let’s take a look at some of the downsides of using Xapo wallet.
Debit Card Limited To Certain Countries
There are many benefits to the prepaid Visa debit card that Xapo offers. However, unfortunately it is only available in certain countries. There’s a lack of transparency over which countries can benefit from this debit card, so you’ll need to check with Xapo directly to find out whether your country is on their approved list.
Only Supports Bitcoin
One of the key disadvantages of Xapo is that it only supports Bitcoin. This means that other major cryptocurrencies such as Ethereum cannot be stored within your Xapo wallet. This is a significant disadvantage for those looking to trade multiple types of cryptocurrencies.
Lengthy Initial Set Up Process
The initial sign-up process for Xapo wallet is relatively lengthy, so set aside plenty of time to get through it. However, streamline design and sophisticated animations help to negate the length and make it feel less laborious. Additionally, you’ll be reassured of the security of the platform during this process, as you’ll be asked for a series of security details to enable two-factor authentication for your wallet.
Not Open Source
Xapo is not an open source platform. This means that its project code is not available for public access, whether for viewing or modification. Whilst many people will not mind this, those who are technically inclined may be put off by not being able to view the code that makes up the platform.
Where Are My Funds Stored With Xapo?
It’s important to know where your funds are stored with Xapo wallet. Like with any custodial wallet provider, Xapo will act as the custodian of your funds. This means that they are responsible for its security, so you need to be sure that they have the right measures in place to guarantee its safety.
Xapo stores 97% of its funds in deep cold storage. This means that the funds are stored on servers which have never been connected to the internet. The remaining 3% of funds are stored in hot wallets which are connected to the internet. This allows users to quickly and easily access their funds when required, without having to wait for them to be withdrawn from cold storage.
Which Cryptocurrencies Can Be Stored In Xapo?
Xapo only supports Bitcoin, meaning that other cryptocurrencies cannot be stored within this wallet. The currency exchange services are limited to BTC, meaning that you also cannot trade Bitcoin Cash or Bitcoin Gold through this platform.
This will no doubt be an issue for anyone who enjoys trading in a wide range of cryptocurrencies, such as Ethereum, Litecoin or Ripple.
The Xapo Wallet is free to download from the Apple App Store or the Google Play Store. There is then an annual fee which currently sits at $150. This fee includes your personal wallet and an Xapo Visa debit card.
Transferring money or coins between Xapo accounts is free. However, if you decide to transfer Bitcoin to another wallet, it will be subject to a transaction processing fee which is determined by the Bitcoin network.
When you make an outgoing transaction, you can choose to stick with a standard transaction fee, or you can opt to pay a priority fee for your transaction to be expedited.
There are also fees for incoming transactions. These fees depend on the amount being received, as well as whether the transaction is a wallet or vault transaction. Current fees can be viewed on the Xapo website.
How Safe Is Xapo Wallet?
Xapo is renowned for its high levels of security, with the platform going the extra mile to keep funds secure. Let’s take a look at some of the security measures that Xapo have put in place.
Deep Cold Storage
As we’ve already mentioned, Xapo has a great reputation when it comes to security. Only 3% of Bitcoin reserves are stored in hot wallets which are connected to the internet. These reserves are insured against any potential loss incurred as a result of a hack.
The other 97% of funds are stored in deep cold stored. The private keys to access these Bitcoin funds are stored on servers that have never been connected to the internet. These servers are held in secret bunkers around the world which are guarded by security staff. This demonstrates how seriously Xapo takes security.
When you open a Xapo account, you’ll have to go through a know-your-customer process. This process will involve entering your personal details, uploading an ID document and taking a selfie. You’ll then set up two-factor authentication which will be used to access your wallet, helping to protect it against hackers.
Instant Notifications On Spending
Xapo has an optional feature which will send an alert to your phone every time that funds are moved out of your wallet. This provides you with extra security protection against hackers whilst helping you to keep track of your funds.
Private Key Segmentation
When your funds are sent to the vault, they are encrypted and broken down. They are then stored on paper and external devices. Each private key is then segmented and physically distributed to multiple locations, making it virtually impossible for funds to ever be stolen from the vaults. This provides you with the maximum possible security for your funds.
Is There An Alternative To Xapo?
In terms of wallets in which to store your cryptocurrency, you won’t find a wallet much more secure than Xapo. The prepaid Visa debit card is an additional functionality which is enjoyed by its worldwide user base.
Whilst Xapo is a promising option for traditional traders who are happy investing their time into manually trading Bitcoin, it doesn’t offer anything to beginner traders who are looking for a simple way to get started with trading, or those looking to take a hands-off approach.
If you’re looking for a way to create a passive income stream, allowing you to earn profits from cryptocurrency without spending hours studying the market, copy trading could be right for you.
Copy trading allows you to invest in and sell a wide range of different cryptocurrencies, as well as ForEx and stocks, without needing to watch graphs and follow trends. You can take a completely hands-off approach if you choose, by selecting an experienced trader to follow. Alternatively, you can watch an experienced trader and pick and choose which of their actions to follow. It’s a great way to get started for beginners, or to create a passive income stream with little effort.
Where Can I Download Xapo Wallet?
Xapo wallet is compatible with Android and iOS, as well as being available through an internet browser. You can download the Xapo Wallet app from the Google Play Store and the Apple AppStore.
Can I Buy Bitcoin On Xapo?
Xapo users can buy and sell Bitcoin directly through the app. To buy Bitcoin through Xapo, simply click “Add money”, followed by “Buy more BTC”. You can pay for your Bitcoin through a wide range of payment methods, including bank transfer, credit or debit card, Bitcoin and e-money transfer services such as Netteller and Skrill.
Do I Need A Wallet To Buy Bitcoin?
If you want to begin buying Bitcoin, you’ll need a wallet to store it in. A wallet is an online app that can hold your cryptocurrency. It’s important to look for a wallet which has high levels of security to protect your digital assets against hackers.
Xapo: The Verdict
Xapo is a great option for people who want to store their digital funds with a custodian. Its high levels of security mean that your digital assets are well protected, whilst its fees are reasonable for the service provided.
However, the process of owning and storing Bitcoin can be laborious and time consuming. There is another way to profit from the price moves of Bitcoin without needing to physically own and store the currency. This is where copy trading comes in.
With copy trading, you can invest in a wide range of cryptocurrencies, along with stocks and ForEx, without needing to study graphs or follow the markets. You can simply choose an experienced trader to follow and then sit back while they do the hard work.
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