Ripple Labs, a renowned player in the cryptocurrency space, is applying for a national banking license to strengthen trust in its RLUSD stablecoin. This move aligns with the broader industry trend of seeking regulatory approval to enhance credibility.
Ripple and Banking License
Ripple CEO Brad Garlinghouse confirmed in a post on X that the company is applying for a license with the Office of the Comptroller of the Currency (OCC). "True to our long-standing compliance roots, Ripple is applying for a national bank charter from the OCC," he stated. If approved, the license would place Ripple under both state supervision by the New York Department of Financial Services and federal oversight. This would create a unique benchmark for trust in the stablecoin market.
Circle Initiatives
Just two days later, USDC issuer Circle also revealed that it submitted an application to the OCC to create a national trust named First National Digital Currency Bank, N.A. This initiative would allow Circle to directly custody the reserves backing USDC rather than solely relying on external banking partners. Circle Co-Founder and CEO Jeremy Allaire said this move marks a significant step toward creating a transparent, efficient, and accessible internet-based financial system.
Legislative Overview and Impact
These developments come as federal legislation known as the GENIUS Act advances. The bill recently passed the Senate but still needs to be approved by the Republican-controlled House before becoming law. This legislation aims to establish clear requirements for stablecoins, including mandates for issuers to maintain full dollar reserves and provide monthly reports.
The applications from Ripple and Circle for banking licenses highlight the companies' commitment to compliance and increasing user trust in the crypto industry. These initiatives, coupled with the potential GENIUS Act, could lead to significant changes in the regulation of stablecoins in the near future.
