Argentine entrepreneur Wences Casares has spent several years convincing Silicon Valley millionaires and billionaires that Bitcoin is the currency of the future and that they should all be buying it. But more importantly, Casares has also convinced them that he should be the one to safeguard these purchases. His startup, Xapo, has built a network of underground vaults in five different continents, including one in a decommissioned Swiss military bunker.
But how does one protect a currency that only exists digitally? By storing it in row upon row of computer servers that are disconnected from the Internet. This isolation means it takes up to two days to access and use the Bitcoin stored with Xapo, but it also makes the currency almost impossible to be stolen from hackers who have proven to be increasingly adept at online theft.
Two of Capo’s wealthy clients told Bloomberg that the company houses roughly $10 billion worth of Bitcoin, or about seven percent of the global Bitcoin supply. Xapo is just four years old, but if the estimated cache of Bitcoin is correct, it has more “deposits” than 98 percent of the roughly 5,670 banks in the U.S.
“Everyone who isn’t keeping keys themselves is keeping them with Xapo,” said Ryan Radloff of CoinShares, which has more than $500 million of Bitcoin stored at Xapo, to Bloomberg. “You couldn’t pay me to keep it with a bank.”
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