In the US, the Genius legislation provides regulatory clarity for stablecoins. Ripple now plans to apply for a banking license to further secure its stablecoin RLUSD. A trend is beginning.
Ripple, the crypto company known for its XRP, plans to operate as a US bank in the future. CEO Brad Garlinghouse writes on X that the company will apply for a corresponding license from the Office of the Comptroller of the Currency (OCC). Furthermore, Ripple’s subsidiary Standard Custody is seeking a so-called Fed Master Account with the US Federal Reserve. Both initiatives are intended to benefit the Ripple stablecoin RLUSD and strengthen trust through an additional layer of security. The news agency Reuters compares Ripple’s move to Circle, which focuses on the stablecoin USDC.
The background to the applications is the Genius legislative package, with which the US legally recognizes stablecoins. Ripple’s RLUSD, like Circle’s USDC, is designed as a 1:1 replica of the US dollar and is fully backed by cash reserves and US Treasury bonds. Garlinghouse estimates the stablecoin market at over $250 billion and emphasizes that RLUSD represents “regulation first.” Ripple has lived up to its law-abiding roots for many years and now wants to position RLUSD in the same way.
Observers explain that an OCC license would allow Ripple to avoid the detour through cooperating banks when handling RLUSD, along with the associated fees. A business account with the U.S. Federal Reserve would also mean that Ripple could deposit its RLUSD reserves directly with the Fed, which is considered an immense vote of confidence.
The situation is largely comparable with Circle and USDC, with the exception that Circle has been listed on the stock exchange as CRLC since the beginning of June. This has generated considerable interest because issuing a stablecoin through interest on the deposited reserves and fees is a highly profitable billion-dollar business, at least for market leader Tether (USDT).
The Ripple stablecoin RLUSD remains a smaller player in its segment, with a current market capitalization of around $470 million. USDC has a market capitalization of just over $60 billion, and USDT (Tether) even has a market capitalization of almost $160 billion. One ulterior motive behind the legal recognition of stablecoins in the US through the Genius legislative package is to establish the US dollar as a global reserve currency, also in digital form.
Major banks like JP Morgan are therefore working on their own stablecoins. Ripple, once focused on XRP, is in the process of transforming into a financial company with blockchain expertise, and RLUSD is set to play a central role in this. It remains to be seen how the US authorities will react to the applications from Ripple and Circle (USDC). In general, the US has been transforming into an officially crypto-friendly country since Donald Trump took office and has even begun to establish a strategic Bitcoin reserve.
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