Market News

Ripple Makes A Strategic Move for US Banking License, But XRP's Future Remains Uncertain

This week, Ripple applied for a national banking license in the United States, a strategic step towards becoming a regulated financial entity.

However, the market's reaction was lukewarm, with XRP seeing only a modest price increase of 3% after the announcement.

The banking license, if granted, does not enhance XRP’s legal status or immediate utility within the crypto landscape.

Ripple aims to operate as a custodian for digital assets, specifically managing stablecoin reserves for its new product, RLUSD, aligning with trends seen from other crypto firms.

Despite these ambitions, the banking license would not change XRP's current regulatory standing, as reaffirmed by a recent court ruling on XRP's status.

Ripple's decision to drop its cross-appeal against the SEC means it still cannot engage in institutional sales of XRP without proper registration.

Thus, even with a banking license, Ripple cannot leverage it to restart such sales domestically, leaving XRP's federal securities status unchanged.

While the license could enhance Ripple's integration of services and provide long-term opportunities, immediate benefits for XRP remain unlikely.

For now, traders seem to view Ripple’s bid as a corporate compliance effort rather than a boost to token utility, signaling a neutral outlook on XRP's value.

As Ripple endeavors to reshape its regulatory profile, XRP is left in a holding pattern, awaiting significant developments to elevate its practical use in financial transactions.