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Ripple Labs is making a strategic move by applying for a national bank charter, signaling a significant shift towards regulatory compliance and integration with traditional finance.
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This follows Circle Internet Group’s similar application, reflecting a broader trend among crypto firms to align with emerging US stablecoin regulations under the Office of the Comptroller of the Currency (OCC).
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According to Ripple CEO Brad Garlinghouse, securing a banking license would establish a “new benchmark for trust” in the stablecoin market, enhancing federal and state oversight.
Ripple’s bank charter application marks a pivotal step in stablecoin regulation, aligning crypto firms with US financial oversight and boosting market trust.
Ripple’s National Bank Charter Application Advances Stablecoin Regulation
Ripple Labs’ decision to pursue a national bank charter with the Office of the Comptroller of the Currency (OCC) represents a calculated effort to embed itself within the regulated financial ecosystem. This move comes in the wake of the US Senate passing the GENIUS Act, a legislative framework designed to impose clear regulatory standards on stablecoin issuers. By seeking this charter, Ripple aims to operate under comprehensive federal and state supervision, which could set a precedent for other crypto firms navigating the evolving regulatory landscape.
The company’s Ripple USD (RLUSD) stablecoin is already regulated by the New York Department of Financial Services, and the bank charter would further solidify its compliance credentials. This regulatory alignment is critical as stablecoins face increasing scrutiny regarding reserve transparency and consumer protections.
Circle’s Parallel Move Highlights Industry-Wide Shift
Ripple’s application follows closely after Circle Internet Group’s submission to the OCC to establish a national trust bank. Circle’s USDC stablecoin, the second-largest by market capitalization, stands to benefit from enhanced regulatory clarity and trust once overseen by a national bank charter. Circle CEO Jeremy Allaire emphasized the company’s proactive approach to aligning with forthcoming US regulations, underscoring a growing consensus among stablecoin issuers to embrace federal oversight.
Currently, Anchorage Digital remains the only crypto firm holding a national bank charter, making Ripple’s and Circle’s applications significant milestones in the maturation of crypto finance.