Ripple Wants to Become a Bank in America – The Traditional Financial Sector is on Edge

Ripple – the blockchain company behind the digital currency XRP – is facing strong opposition from the traditional banking sector in its plan to seek a federal banking license in the United States. This is a bold move, demonstrating Ripple's ambition to integrate more deeply into the traditional financial system. New Step: Apply for Federal Banking License In July, Ripple submitted an application for a national banking license from the Office of the Comptroller of the Currency of the United States (OCC). If approved, Ripple will be able to operate as a federally licensed bank, expanding financial services nationwide without needing to obtain individual state approvals. At the same time, Ripple's subsidiary Standard Custody has also applied for a master account at the Federal Reserve (Federal Reserve Master Account). If successful, Standard Custody could directly hold reserves of RLUSD – Ripple's new stablecoin – at the Fed, reducing reliance on intermediaries and enhancing the safety of cash flow. Reasons Why the "Big Banks" Oppose Ripple's plan has sparked a strong backlash from the Bank Policy Institute (BPI) – an organization representing 42 major banks in the US, including JPMorgan, Citigroup, Bank of America, Goldman Sachs, Morgan Stanley, BNY Mellon, and many other names. BPI believes that: The regulations regarding digital currency in the US are still unclear. The public disclosure period is too short – only 2.5 weeks for the public and stakeholders to review, which is insufficient to assess the impact and risks. There are potential risks to the financial system if blockchain companies have not clearly demonstrated their ability to comply with traditional banking standards. Debate About Transparency and Risk Not only this time, but previously, banking associations such as the American Banking Association have also requested the OCC to postpone the decision on granting licenses to Ripple, Circle, or Fidelity Digital Assets. Concerns include: Lack of transparency in the application for permission. There is insufficient proof of compliance with the operational standards of the trust bank. The community consultation process is too short, which may undermine trust and increase risks for the financial system. Global Trend Increasingly Requests Banking Licenses for Crypto Businesses Despite the opposition, the demand for federal banking licenses from crypto companies is increasing. The emergence of new regulations such as the GENIUS Act has begun to provide a clearer legal framework for stablecoins, making it easier for asset digitization companies to operate nationwide. In addition, the latest report from the White House also emphasizes the necessity of: Provide clear rules for digital asset companies to apply for banking licenses. Access master accounts at the Fed. Provide services such as digital asset custody, tokenization, and stablecoin issuance without being hindered by ambiguous regulations. Conclusion Ripple is at a critical stage in its journey to expand into the traditional banking sector. If it overcomes barriers from the "big players" in banking, the company could become one of the first blockchain organizations to obtain a federal banking license and a Fed account. This not only opens up opportunities for the development of digital payment services and stablecoins but also positions Ripple as a pioneer in the digital financial revolution.