Ripple Seeks Changes to Fed Rules for Stablecoins

Ripple Labs Inc. has approached the Federal Reserve System with a proposal to amend existing rules governing payment accounts. The company argues that updating the framework would make it easier for stablecoin issuers to operate and would accelerate the integration of digital assets into the U.S. financial system.

Ripple submitted a formal letter outlining its comments on the proposed Payment Account framework. In the document, the company suggested four specific changes. These include limited access to the Fed’s discount window for eligible payment stablecoin issuers, the ability to earn interest on reserves, replacing the fixed $500 million cap with a more flexible threshold based on asset size, and introducing a pre-funded ACH settlement model designed to reduce credit risk.

According to Ripple’s Chief Legal Officer, Stuart Alderoty, the proposed structure would allow reserves to be held on a 1:1 basis directly at a Federal Reserve bank. In his view, this would be the safest way to safeguard funds and would align with the stability principles set out in the GENIUS Act.

Ripple is currently developing its own stablecoin, RLUSD, alongside its cryptocurrency XRP, which operates on the XRP Ledger. The company emphasizes that XRP can function as a liquidity tool for fast and low-cost transfers. Meanwhile, the Ripple Payments Direct architecture has been designed to support multiple currencies and tokens, offering transparency and near-instant settlement.

The company is also seeking broader access to U.S. financial infrastructure. On July 2 last year, Ripple applied to the Office of the Comptroller of the Currency for a National Trust Bank Charter. In December, it received conditional approval to establish Ripple National Trust Bank. Such a license would allow the firm to provide institutional digital asset custody services nationwide under a unified federal regulatory framework.

Additionally, through its subsidiary Standard Custody & Trust Company, Ripple has applied for a master account with the Federal Reserve. Direct access would enable the company to use Fedwire and FedNow services and to hold RLUSD reserves at the central bank. The application is currently under review.

From Ripple’s perspective, the primary goal is enhanced security and greater independence. Holding stablecoin reserves directly at the Federal Reserve would significantly reduce reliance on commercial banks, strengthening stability and credibility in the eyes of institutional clients.

Another key motivation is access to critical U.S. payment infrastructure. Without direct integration with Fed systems, projects like RLUSD face higher costs and operational complexity. Broader access would mean faster settlements and smoother integration with the traditional financial system.

Regulatory clarity is also a central issue. Ripple aims to operate under clear, uniform federal rules rather than navigating a patchwork of state-level licenses. This approach would simplify operations and provide greater legal predictability.

In short, the proposed changes are intended to help Ripple position itself as a fully regulated entity that bridges the gap between cryptocurrencies and traditional finance in a secure and compliant manner.