Ripple’s Federal Power Play: Why a National Bank Charter Could Reshape Stablecoins

By Sophia Vance — July 7, 2025

When Brad Garlinghouse hit “send” on his July 2 post confirming that Ripple had filed for a U.S. national bank charter, crypto Twitter erupted—and for good reason. If the Office of the Comptroller of the Currency (OCC) green-lights the plan, Ripple would become the first crypto firm to issue a dollar-backed stablecoin under full federal banking supervision, with its RLUSD reserves parked directly at the Federal Reserve through a sought-after master account. Cointelegraph, AInvest

The Mechanics Behind the Ambition

Today RLUSD is supervised by the New York Department of Financial Services, a gold-standard state regulator, and boasts roughly $470 million in circulation just seven months after launch. AInvest A national charter would lift Ripple out of the patchwork of state money-transmitter regimes and into the same regulatory stratosphere as BNY Mellon or State Street’s trust banks. In plain English: Ripple wants a seat at the adults’ table, complete with direct Fed access, 24/7 settlement-rail privileges, and explicit FDIC-style oversight of its risk controls.

“We’re not abandoning decentralization; we’re institutionalizing it,” a senior Ripple executive told me this week. “Direct Fed custody slashes counter-party risk to effectively zero.”

Reading the Regulatory Tea Leaves

The timing is anything but accidental. The Senate passed the GENIUS Act in late June, teeing up House approval later this summer. The bill designates the OCC as lead supervisor for any stablecoin issuer over $10 billion—effectively nudging serious players to grab a charter before the rules even ink. Cointelegraph

If approved, Ripple would join Anchorage Digital and, potentially, newly public Circle Internet Group—whose own trust-bank application landed on the OCC’s desk on June 30—forming a triumvirate of federally regulated crypto banks. Reuters, Cointelegraph Competition breeds legitimacy; the OCC can now point to multiple applicants and avoid accusations of playing favorites.

The Numbers That Matter

Let’s run the math. RLUSD’s reserves are held 100% in short-dated Treasuries or Fed cash. On a $470 million float, annualized 5.3% T-bill yields translate to roughly $25 million in gross interest income. With direct Fed custody, Ripple keeps the full spread instead of sharing it with commercial custodians—worth an estimated 30–40 basis-point pickup, or $1.5–$2 million a year at today’s scale. Scale to $10 billion (USDC territory) and you’re talking $50 million in incremental bottom-line juice.

But It’s Not Just About Yield

Direct Fed access reduces settlement latency from hours to seconds, which matters when you’re servicing corporate treasurers moving nine-figure payroll runs or broker-dealers managing T+0 collateral. Cut out four intermediary banks and you also vaporize four single points of failure—an angle every risk committee loves.

Implications for XRP Holders

Contrary to the memes, a national charter isn’t about “pumping” XRP. The token’s recent 3% pop to $2.24 is a sentiment trade, not a balance-sheet one. Cointelegraph What really matters is that every RLUSD on-ramp is also an XRP On-Demand Liquidity off-ramp. The tighter Ripple’s integration with the Fed, the smoother those ODL corridors become—and the more utility XRP accrues.

The Road (and Hurdles) Ahead

The OCC’s charter pipeline isn’t swift. Anchorage waited 14 months. Figure Bank is still in limbo. Expect a similar 12–18 month review for Ripple, including an enterprise-wide Bank Secrecy Act audit, stress-test modeling, and public comment periods. The tougher gate, however, may be the Federal Reserve master account—an opaque process that has tripped up Kraken and Custodia. Ripple’s ace card is Standard Custody & Trust, the New York-chartered entity it bought in February 2024 and the formal applicant for the master account. Cointelegraph

Politically, the calculus has shifted. With the White House now openly courting crypto capital and Congress poised to deliver statutory guardrails, denying master-account access to a federally chartered, OCC-regulated trust bank becomes exponentially harder to justify.

Strategic Foresight: 2025-2028

• Q4 2025 – Q1 2026: Conditional OCC approval; RLUSD reserves migrate from commercial banks to on-balance-sheet Fed accounts.
• 2026: First Fortune 500 treasury desks settle same-day commercial paper via RLUSD. Expect total float to breach $3 billion.
• 2027: Ripple leverages charter to offer insured payment accounts for fintech partners—think “Stripe-style” stablecoin rails.
• 2028: U.S. banks start white-labeling RLUSD for cross-border payments, endorsing a model where crypto rails coexist with traditional KYC.

What Could Go Wrong?

OCC politics can swing; a new Comptroller could slow-roll approvals. The Fed may still view direct stablecoin access as systemically risky. Meanwhile, Congressional gridlock could delay GENIUS Act implementation, muddying supervisory turf. And, of course, a black-swan de-peg event anywhere in the stablecoin universe would ratchet up regulatory skepticism overnight.

The Bottom Line

Ripple’s charter bid isn’t a headline stunt—it’s an architectural pivot. By turning itself into a bank, Ripple is betting that the next phase of crypto will be led not by token speculation but by regulated digital dollars that move at the speed of light and settle with central-bank finality. If the bet pays off, the lines between fintech, crypto, and banking won’t just blur—they’ll disappear.