Bitcoin millionaires keep their cryptocurrency in dungeons on 5 continents

Bitcoin millionaires keep their cryptocurrency in dungeons on 5 continents

For the mighty backs of guards, armored doors in the maze of concrete corridors are not plugged into anything encrypted with the server that holds the keys to huge digital state.

Argentinean businessman of Vincennes Casares spent many years convincing the millionaires and billionaires of Silicon valley that Bitcoin is a global currency of the future, and what each of them needs to purchase a digital currency, and he is a man who knows how to protect purchased coins. His startup, Xapo, has built a network of underground storage facilities on five continents. One of them is located in a former Swiss military bunker.

Xapo rarely allows journalists to look into the citadel, except that in order to write about security. But one secret not yet found the answer: how digital money in those vaults?

Two clients Xapo said that they know about the $ 10 billion in bitcoins. Another person close to the company said this amount close. In the end, Bitcoin is volatile. In the cryptocurrency world $ 10 billion in bitcoins — about 7 percent of the total. This means that Xapo, in just 4 years, has attracted “deposits” more than 98% of 5670 American banks. It should be noted as regulated storages. The Swiss subsidiary is accountable to the standards Association financial services, which tests its members on compliance with laws to combat money laundering. Xapo caters to USA customers through a Corporation registered in the state of Delaware.

“Patient zero”

Casares was nicknamed “Patient Zero” because he first tried to attract the interest of Silicon valley to Bitcoin. Among today’s customers, Xapo founder of LinkedIn Corp. Reid Hoffman and Mike Novogratz.

At Xapo is a network of underground vaults on five continents.

“Anyone who keeps the keys himself, holds them with Xapo,” said Ryan Radloff of CoinShares, which contains more than $ 500 million in bitcoins stored in a Xapo.

The first rule of owning bitcoin is the safe storage of your private key – code that enables you to spend your coins. The most popular alternative is called cold storage, i.e. storage on a standalone device such as a flash drive. But risks remain: hackers set traps on the computers to access the devices cold storage at a time when those connected to the network. Some criminals even break into the house or kidnap people. Bitcoin barons are forced to hide their location, strengthen their homes and to learn martial arts.

In Xapo removing bitcoins from the vault takes about two days. The company verifies the client’s identity and the authenticity of the request before manually sign transactions with private keys from multiple locations in the vault. For any permitted transaction confirmation required three separate repositories. The company also offers customers a marketplace to buy and sell bitcoins, and the first debit card to spend with the cryptocurrency.

44-year-old Casares declined to comment on this information. After a successful advertising campaign Xapo attracted a large audience, but for the most part he avoids contact with the press.

Nevertheless, the gift of persuasion Casares legendary. His preaching of Bitcoin is so prevalent in Silicon valley that when Hoffman proposed to his banker to buy a few Belokonov, the latter asked when he spoke with Casares. The counselor Xapo former US Treasury Secretary Larry summers, former CEO of Citigroup John reed and founder of Visa International, Dee hock. First Block Capital, first registered in Canada cryptocurrency company, chose Xapo as storage after several months of searching. Sean Clark, founder of First Block Capital, who noted that fingerprint scanners store equipped with a reader of the pulse to prevent the use of amputated hands, says:

“Their DNA is focused on safety Whenever we do large transfers, they meet with us, and if need be, they will come to see us.”

It is important to note that Xapo stores bitcoins only because of the beliefs of Casares that only this cryptocurrency will be successful. Because of this dogmatism is losing a Great many customers who want to store other cryptocurrencies.

Casares chose the Bitcoin business of his life. Born the son of a shepherd in a remote region of Patagonia in Argentina, he is throughout his youth, felt the impact of inflation.

It forced him to build a number of fintech startups that have made him a millionaire before he became acquainted with Bitcoin. Casares sold a 75% stake of its financial website Patagon for $ 529 million in 2000, and 13 years later to concentrate on the cryptocurrency, launched the digital wallet Lemon, investing in the project is 43 million. By the time he was a large owner of Bitcoin.

However, in the cryptocurrency community there is a perception that companies such as Xapo, should not exist in the bitcoin ecosystem because slow down their actions what should be a smooth transition.

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