ICBA Opposes Ripple Trust Bank: "7 Pages of Saying We Are Scared of XRP"

BankXRP (@BankXRP), a prominent figure in the XRP community, recently shared a seven-page letter from the Independent Community Bankers of America (ICBA) opposing Ripple’s application for a national trust bank charter.

While this document may read like a technical critique, the underlying message is clear: traditional banking groups fear the structural shift Ripple and XRP represent.

Submitted on August 4, 2025, to the Office of the Comptroller of the Currency (OCC), the ICBA’s objection targets Ripple’s proposed subsidiary, Ripple National Trust Bank (RNTB). The bank, if approved, would work primarily with RLUSD, Ripple’s stablecoin, designed to operate with the XRP Ledger (XRPL).

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Concerns Disguised as Technical Objections

The ICBA’s arguments rest largely on legal and procedural concerns. The group claims RNTB’s activities would violate the National Bank Act by acting as a de facto deposit-taking institution, offering RLUSD to retail users in a way that closely resembles a deposit.

They argue that stablecoins like RLUSD pose risks to banking system stability by incentivizing capital flight from traditional deposits. It references a Treasury report that estimated $6.6 trillion could move to stablecoins if yields are allowed.

Ripple is also accused of leveraging the trust bank structure to bypass full Federal Reserve oversight, as trust banks are not subject to the Bank Holding Company Act (BHCA). The letter claims this weakens the system’s regulatory integrity and threatens consumer protections.

The Real Issue

The ICBA letter extends beyond regulatory concerns. It shows discomfort with Ripple’s growing role in digital finance and its effort to make XRP a key part of institutional payments and stablecoin infrastructure.

While the letter cites Ripple’s past issues with the SEC and FinCEN, it also suggests that Ripple’s strategy threatens the market position of traditional banks.

A Preemptive Strike Against XRP and RLUSD in Banking

The ICBA is urging the OCC to reject Ripple’s trust bank charter and to open formal rulemaking. This move aims to prevent crypto assets like RLUSD from entering the banking system under lighter regulation. Traditional financial institutions are afraid that XRP and RLUSD will dominate the banking system. This is why ICBA attempts to block Ripple out.

Ripple has not yet responded, but the message from the ICBA is clear. Established institutions view XRP’s expanding role as a challenge they are not willing to ignore.

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