Ripple Seeks U.S. National Bank Charter for Faster Settlements

Ripple has taken a significant step towards integrating with the traditional banking system by applying for a U.S. national bank charter and a Federal Reserve master account. This move aims to provide complete regulatory oversight for its RLUSD stablecoin, enhancing trust in digital assets and aligning with customary banking standards. If approved, Ripple will be able to settle transactions directly through the Federal Reserve, offering faster settlements and stronger compliance, which could make RLUSD more appealing to institutions and advance the integration of cryptocurrency with mainstream finance.

Ripple's application was submitted to the Office of the Comptroller of the Currency (OCC), one of the top U.S. banking regulators. Alongside this, Ripple’s trust company applied for a Federal Reserve master account. If approved, Ripple could hold reserves at the Fed and settle payments instantly, including during nights and weekends. This would make Ripple one of the few crypto companies with access to central banking tools, improving transaction speed and reducing settlement risk. It also boosts confidence among institutions that may have hesitated to adopt crypto due to regulatory gaps.

The Ripple charter signals a shift toward stronger oversight in the digital finance sector. By seeking both federal and state regulation, Ripple aims to raise the bar for stablecoins. Jack McDonald stated that the goal is to “meet the highest standards of compliance and transparency,” reflecting the firm’s commitment to fostering institutional trust. Analysts note that crypto companies are moving toward more traditional, bank-like structures to gain credibility and better serve their traditional financial partners. Ian Katz of Capital Alpha Partners noted, “It’s not just about being a crypto company anymore. Firms are working to become banks or bank-like to build trust.”

Ripple is not alone in seeking higher regulatory ground. Circle, the issuer of USDC, has also applied for a federal charter. Anchorage Digital has already secured one. These efforts are tied to a larger trend: crypto firms aligning themselves with the rules followed by banks. However, the Ripple charter would come with added benefits. If approved, the company could offer real-time settlements, better protect reserves, and reduce reliance on third-party banks. Ripple’s stablecoin, RLUSD, has a growing presence, with a current market cap of around $470 million. While smaller than USDT and USDC, it shows potential to scale, especially if Ripple’s bank license increases its credibility.

The Ripple charter application comes at a time when lawmakers are pushing forward on stablecoin rules. Recently, the U.S. Senate passed the GENIUS Act, which outlines more straightforward guidelines for digital currency issuance and management. These changes could give Ripple a stronger position. Since many believe stablecoins will play a key role in future cross-border payments, regulators are watching closely. Approvals by the OCC and the Federal Reserve are not instantaneous. Agency responses determine if the process takes months or longer. But Ripple’s initiation of this process puts it on a path toward greater stability and long-term trust.

The Ripple Charter can serve as a bridge between the cryptocurrency and traditional banking sectors. Ripple offers blockchain efficiency, enabling it to deliver bank-like services. Regulations are tightening, so this move may set a benchmark with others. It provides investors, including institutions, with greater security, along with practical tools within digital finance.