Ripple’s Bank Charter Faces Block from 42 Big Banks, Including Morgan Stanley & Bank of America

 Ripple is facing strong resistance in its effort to become a federally licensed bank in the U.S. 

In July, Ripple applied for a national bank charter with the U.S. Office of the Comptroller of the Currency (OCC), signaling a major step toward deeper integration with the traditional financial system.

In a parallel move, its subsidiary, Standard Custody, also applied for a Federal Reserve Master Account, which would enable it to hold RLUSD reserves directly with the Fed. These coordinated efforts reflect a broader push by crypto firms to secure regulatory clarity, reduce dependence on intermediary banks, and strengthen their position within the financial sector.

Why Are the Banking Giants Pushing Back? 

However, Ripple’s plans have sparked strong resistance from some of the biggest names in banking. 

The Bank Policy Institute (BPI), which represents 42 major U.S. banks, has voiced opposition. Members include JPMorgan, Citigroup, Bank of America, Goldman Sachs, Morgan Stanley, BNY Mellon, and others.

The major concerns it cited were unclear crypto regulations and the limited time given for public input. It argues that the public was given just 2.5 weeks to review the application, and said it was inadequate for assessing the proposal.

This clash highlights the growing divide as traditional institutions are concerned about blockchain startups entering their regulated space.

Transparency and Risk in the Spotlight

But this is not the first time banking groups have raised red flags.

Previously, banking groups, including the American Banking Association, had urged the OCC to delay its decision on granting national bank charters to crypto firms like Ripple, Circle, and Fidelity Digital Assets. In a joint letter, the groups argued that the applications from the crypto companies lacked transparency and did not clearly show how these firms meet trust bank standards.

They also cited concerns over limited public review, which they say could undermine trust and introduce risks to the financial system.

Momentum Builds for Crypto Banking Charters

However, interest in crypto banking charters is growing. With new legislation like the GENIUS Act laying out clearer rules for stablecoins, more crypto firms are expected to apply. Experts say that these federal charters could help crypto companies operate nationwide without needing separate state licenses.

Besides, the recent White House report is also pushing for clear rules to help digital asset firms obtain bank charters, access Fed master accounts, and offer services like custody, tokenization, and stablecoin issuance without being held back by vague or outdated regulations. 

Even with opposition from major banks, Ripple is pushing boundaries to innovate in digital payments and stablecoins, which is further backed by growing regulatory clarity.