Bitcoin services provider Xapo has announced the launch of Xapo Institutions, a suite of products aimed at capturing a potentially lucrative customer base that includes businesses, bitcoin exchanges, hedge funds and institutional investors.
Institutions launches today with a treasury management system that Xapo contends will empower organisations to better manage bitcoin through permissions and privileges that can help protect large bitcoin holdings from miscues and misconduct.
The treasury controls allow users to structure and organize accounts into an array of wallets and vaults, and then control which parties have access to funds.
Chief strategy officer (CSO) Ted Rogers positioned the announcement as a larger step forward for the company, one that he argues finds Xapo building on its basic infrastructure of products like multi-signature wallets and deep cold storage for the first time.
Rogers told CoinDesk:
”We started out focusing on building the most secure place to store bitcoin, now we’re evolving from that into providing more customized tools that are essential for organisations.”
The new tool suite will be available free of charge, Rogers said, adding that Xapo wanted to ensure users can begin to feel comfortable with both bitcoin and its management system, stating that “revenue models will come as the industry matures”.
The news follows Xapo’s release of consumer-facing security offerings it debuted in January.
No more physical processes
Rogers indicated that Xapo’s new treasury management system will solve problems for existing clients today, removing their need to go through physical in-person processes to initiate transactions.
Xapo, he said, built the product in part to better manage its own bitcoin holdings, and that it has a new institutional client team dedicated to migrating new customers to its service.
Calling the tool simpler and more transparent, Rogers said the product is a response to institutional clients who found earlier fund management processes problematic. As an example of the change, Rogers explained that the treasury management system now allows users to control and automate permissions for bitcoin accounts.
“You can add someone or multiple people to initiate transactions, and then you add people to approve transactions over a certain limit and set others who have only view-only privileges,” Rogers said.
He went on to frame the product as most useful to bitcoin-only institutions today, though he hoped the product would be appealing to organisations that are new to the ecosystem as well.
The Xapo Institutions dashboard features a bright and straightforward design, with wallets organized and color-coded for users.
One area of particular focus, Rogers said, was withdrawals from other institutional vault services, which he described as requiring confirmation from parties hours after the transaction.
“If you’re involving a lot of people it can get complex, so we had to simplify that process as much as possible,” Rogers noted.
The result is that now the service sends ‘action required’ emails to involved parties, allowing them to confirm or stop the request.
Need for new solutions
Rogers further spoke of the need for products built for an institutional client base, citing the recent string of hacks in the bitcoin space.
The former investor called the use of consumer tools by institutions a “big issue”, and pointed to the recent incidents as evidence for the need for institutional products, saying:
“Some of the hacks that are happening are driving home the point that ‘Hey, we need to focus on our core business and let Xapo handle the secure storage of bitcoin’.”
Echoing other business-to-business companies in the space, Rogers called on the industry, even those who may compete against Xapo in other verticals, to recognize that security is now something they must consider outsourcing to capable partners.
For those who want to migrate to the service, Rogers pitched Xapo’s team as capable of guiding users through the transition.
“It’s not very complex but it is something that, when you’re dealing with large amounts of bitcoin, you want to make sure you’re holding people’s hands as much as they need and want,” he added.
Going further, Rogers suggested that the treasury management system is a “baseline product” one that could one day expand in “creative ways”.
Rogers speculated this might include using fiat currencies secured to a blockchain, but said such discussions, while possible, are still in very early stages.
“We’ll be expanding it as the industry evolves,” he said.