How does Xapo bank make 8%-10% consistently so they can give you 4% on your deposits and keep their 4-6% profit?

I’m telling you, it is very hard to make 8-10% with a stock portfolio consistently so they are not investing your deposits in stocks.

Who are they lending your money to? Which company needs capital that badly that they are going to pay 8%-10% back on a loan to Xapo?

Those are questions to ask yourself about the business model of Xapo bank before you deposit your fiat there.

What are they doing with your bitcoin?

Are they lending that out? To whom?

Because the moment you put your bitcoin and your fiat in a bank, your deposits are not there anymore. The money and bitcoin can be lend out!! That is called fractional reserve.

What percentage of your deposits need to be in a bank in Gibraltar? How many X is Xapo leveraged? 10 x? So they can lend out 1000 usd of they got only 100 usd? 15x? I don’t know. Do you?

Banks can create money out of thin air by creating loans.

They can lend your bitcoin out to whatever crypto company who needs bitcoin for trading.

You are only going to find out if this happened when you visit a website of Xapo and you see: due to some technical difficulties we are temporarily closed.

Rest assured your funds are safe…..

Then you want to book a flight to Gibraltar to get your 99 k. And if you have more than 100 K you know you will not get any of it back.