XRP News Today: 42 Banks Oppose Ripple's Federal License Bid Over Regulatory Clarity and 2.5-Week Review Concerns

Ripple’s application for a federal banking license in the U.S. has faced significant pushback from traditional banking institutions, as revealed by recent developments involving the Bank Policy Institute (BPI). The BPI, representing 42 major U.S. banks, has actively lobbied against Ripple’s bid to secure a national trust bank charter from the Office of the Comptroller of the Currency (OCC), citing concerns over regulatory clarity and insufficient public review time. The move underscores a growing rift between legacy financial players and crypto-native firms seeking to integrate blockchain technology into regulated systems [1].

Ripple submitted its application to the OCC in July 2025, aiming to establish a federally chartered institution that would enable services such as digital asset custody, stablecoin issuance (via its RLUSD token), and direct access to the U.S. payment system through a Federal Reserve master account. Critics argue the proposal lacks a traditional fiduciary framework, as Ripple’s model prioritizes digital asset management and tokenization over estate or trust services. The BPI and the American Bankers Association jointly objected to the application, highlighting the compressed 2.5-week public comment period between July 16 and August 4 as inadequate for evaluating a novel and complex crypto-based proposal [2].

Paul Barron, a crypto analyst, characterized the BPI’s actions as a strategic effort to protect market dominance rather than ensure compliance. He noted that Ripple’s potential access to the Federal Reserve’s infrastructure could disrupt cross-border payment markets long controlled by traditional banks. The firm’s RLUSD stablecoin has already gained traction for real-time settlements and liquidity management, with over $15 billion in annualized transaction volume by mid-2025 [3].

The debate extends beyond regulatory technicalities. Ripple positions itself as a bridge between blockchain innovation and traditional finance, advocating for a hybrid model that aligns digital assets with regulated frameworks. Its On-Demand Liquidity (ODL) service, which leverages XRP for cross-border transactions, has attracted 300+ institutional partners globally. However, the BPI’s lobbying reflects broader industry concerns that crypto firms may bypass existing banking gatekeepers, challenging the status quo [4].

Legal and policy questions remain unresolved. Critics argue Ripple’s business model does not align with the legal definition of fiduciary activities required for a national trust charter. Meanwhile, Ripple emphasizes the need for regulatory clarity as blockchain-based payments become integral to global finance. A successful charter would set a precedent for crypto firms seeking bank-like status, potentially reshaping U.S. financial infrastructure [5].

The outcome of Ripple’s application could influence the trajectory of crypto regulation. If approved, it may accelerate the integration of blockchain into mainstream finance, encouraging other fintechs to pursue similar pathways. Conversely, rejection or delays could reinforce traditional banks’ dominance over critical financial systems. The BPI’s resistance also intersects with the SEC’s ongoing lawsuit against Ripple over XRP’s classification as a security, highlighting the multi-pronged regulatory challenges facing the firm [6].

The clash between Ripple and the BPI reflects a broader ideological divide in finance: one advocating for decentralized, technology-driven solutions and the other seeking to preserve centralized control. As the U.S. regulatory landscape evolves, the resolution of Ripple’s licensing bid—and the BPI’s efforts to block it—could mark a pivotal moment in the crypto industry’s journey toward mainstream acceptance.

Sources:

[1] [XRP News Today: BPI Opposes Ripple's Federal Charter](https://www.ainvest.com/news/xrp-news-today-bpi-opposes-ripple-federal-charter-bid-fiduciary-regulatory-concerns-2507/)

[2] [Ripple's Banking License Update: Attempted Blocking](https://timestabloid.com/ripples-banking-license-update-attempted-blocking/)

[3] [Ripple Payments (ODL) Growth Metrics](https://www.ainvest.com/news/xrp-news-today-bpi-opposes-ripple-federal-charter-bid-fiduciary-regulatory-concerns-2507/)

[4] [Ripple’s Banking License Update: Attempted Blocking](https://coinmarketcap.com/community/articles/6887e5d212f6aa4d91cb64bf/)

[5] [BPI Represents 42 Major U.S. Banks](https://coinmarketcap.com/community/articles/6887e5d212f6aa4d91cb64bf/)

[6] [Ripple’s Federal Charter Application and SEC Lawsuit](https://timestabloid.com/ripples-banking-license-update-attempted-blocking/)