Ripple Labs is applying for a banking license in the US, following Circle Internet Group's example. These steps aim to enhance interactions between the crypto industry and traditional financial institutions.
Ripple's Banking License Application
Ripple CEO Brad Garlinghouse announced that the company is applying for a national bank charter with the Office of the Comptroller of the Currency (OCC). In a post on platform X, he confirmed a report from The Wall Street Journal, stating that gaining the license would set a 'new (and unique!) benchmark for trust in the stablecoin market,' as the firm would be under federal and state oversight. The New York Department of Financial Services is already regulating Ripple's USD (RLUSD) stablecoin.
Industry Reaction to GENIUS Act
Ripple's decision to pursue a banking license came just two days after Circle submitted a similar request to establish a national trust bank overseeing its stablecoin reserves. This move coincides with the US Senate passing the GENIUS Act, a stablecoin regulation bill that lays out standards for US dollar-pegged tokens. Circle co-founder and CEO Jeremy Allaire mentioned that the company is taking 'proactive steps' to align with emerging US regulations regarding dollar-denominated payment stablecoins.
XRP Dynamics in Response to News
Following the announcement regarding the banking license application, XRP, the token used in Ripple's products, rose by 3.2%, reaching $2.24. The token began to climb late Wednesday, peaking at $2.27 coinciding with Garlinghouse's post before slightly retracting.
Ripple's move to apply for a banking license underscores the crypto industry's efforts to gain legitimacy and regulation. These steps may become pivotal for future engagements between traditional finance and crypto technologies.
