Ripple is calling on the Federal Reserve to modernize payment account rules to support stablecoin issuers, arguing that targeted reforms could strengthen the dollar’s dominance, reduce systemic risk, and accelerate the integration of compliant digital assets into the U.S. financial infrastructure.
Ripple requests Fed to change payment account framework for stablecoin issuers
Regulatory efforts around digital assets continue to expand as businesses seek clearer access to U.S. payments infrastructure. Ripple Labs Inc. submitted a comment letter to the Federal Reserve on February 6, asking for amendments to the proposed Reserve Bank Payment Account Framework to better accommodate stablecoin issuers and digital payments facilitators.
In its letter, Ripple recommends four important changes to the payment account prototype. These include granting limited-purpose discount window access to authorized payment stablecoin issuers, allowing interest on reserve balances to prevent reserve concentration within commercial banks, replacing the fixed $500 million overnight cap with an asset-based proportional threshold, and introducing pre-funding. $ACH A payment model that eliminates credit risk.
“The PA Prototype provides an important pathway for Permitted Payment Stablecoin Issuers (PPSIs) to eliminate counterparty risk by holding 1:1 reserves directly at the Federal Reserve, the ‘gold standard’ for reserve security and the ultimate realization of the stability goals of the GENIUS Act,” said Stuart Alderroti, Ripple’s Chief Legal Officer. He pointed out:
“Ripple stablecoin, $RLUSDand cryptocurrencies $XRP Powered by these solutions, Ripple and its customers can shape the modern financial system. ”
Mr. Alderoti further explained: $XRP – Native token $XRP Ledger – Available as a powerful liquidity tool that enables fast and low-cost transfers, the RPD (Ripple Payments Direct) architecture is built to support a wide variety of currencies, tokens, and financial use cases, ensuring transparency and instant settlement regardless of the underlying assets being moved. ”
Separately, Ripple has formally applied for federal banking and payments access approval to expand beyond its role as a software provider. The company applied for a National Trust Bank Charter through the Office of the Comptroller of the Currency (OCC) on July 2 last year and received conditional approval in December, establishing Ripple National Trust Bank. This charter allows Ripple to provide institutional digital asset custody, meet federal stablecoin issuance requirements under the GENIUS Act, and operate nationally under a single federal framework rather than maintaining individual state licenses.
The cryptocurrency company has also applied for a Federal Reserve Master Account through its subsidiary Standard Custody and Trust Company, but this application is still under review. A master account provides direct access to Fedwire and FedNow, $RLUSD Reserves held by the Federal Reserve System. Although the Fed independently evaluates such applications and has historically limited access for crypto-native companies, Ripple’s conditional approval from the OCC places Ripple among the companies seeking greater integration with U.S. payments rails.
FAQ ⏰
- What changes has Ripple proposed to the Federal Reserve Payment Account framework?
Ripple proposed access to a discount window, interest on reserve balances, a proportional asset base cap, and pre-funding. $ACH payment model. - How is a payment account different from a traditional master account?
The proposed payment account does not offer intraday credit, intraday overdraft, or correspondent banking institutions. - how $RLUSD Is it related to Ripple’s Federal Reserve proposal?
Ripple said $RLUSD Under this framework, it would benefit from holding 1:1 reserves directly with the Federal Reserve. - What role does it play? $XRP Interested in taking advantage of Ripple’s payment architecture?
$XRP It serves as a liquidity tool that enables fast and low-cost transfers within Ripple’s extensive RPD architecture.
