The U.S. banking system is undergoing a significant overhaul through the EGRPRA review lasting until 2026.
This review allows top financial regulators to update banking laws without the need for Congress, creating an opportunity to redefine the banking model in the digital era, with Ripple standing out as a candidate for a national trust bank license.
MAIN CONTENT
EGRPRA is an important banking law review that occurs once every ten years.
Ripple is applying for a trust bank license, paving the way for a new digital finance model.
National banks can operate based on blockchain technology, Smart Contracts, and Stablecoins.
What is EGRPRA and what is the role of this review in the U.S. financial system?
EGRPRA (Economic Growth and Regulatory Paperwork Reduction Act) is a banking law review conducted once every decade, allowing three major U.S. financial regulatory agencies, including OCC, Fed, and FDIC, to update regulations without Congress.
This year's review lasts until July 2026, aiming to adapt legal regulations to the rapid development of the digital finance and Blockchain industry. This is a rare opportunity to redefine the banking model and financial services in the digital era.
Why is Ripple prominent in this EGRPRA review?
Ripple has applied for a national trust bank license, a new financial organization model entirely different from traditional banks, not focused on fundraising or lending but specialized in processing blockchain services.
This allows Ripple to operate asset tokenization services, Smart Contracts, and Stablecoins legally under the supervision of U.S. financial authorities, while also opening new directions for the digital financial system.
"This is a turning point in redefining financial entities, moving from traditional licenses to entities operated by code."
Mr. Man, cryptocurrency legal expert, 2024
How can the U.S. Central Bank facilitate Ripple to be 'fast-tracked'?
According to Fed regulation 12 CFR § 262.3, after Ripple's application is made public, the review process lasts for 90 days with comments. However, the Fed has the discretion to skip this step if necessary to ensure the stability of the financial system.
This provision allows the Fed to 'quickly approve' Ripple if the company's services significantly contribute to liquidity and financial stability in the tokenized economy.
What changes may occur after the EGRPRA review concludes in 2026?
By 2026, the U.S. may witness the emergence of a new financial organization model: digital banks based on blockchain technology, capable of operating smart contracts and processing Stablecoins like traditional banks manage payments and transfers.
Ripple could become the first organization to be legally licensed based on digital technology, ushering in a new era for DeFi recognized by law in the U.S.
How will the new financial system transformation take place in the vision of experts?
This change will not make headlines with a big announcement but will happen quietly. Experts predict that the financial system will operate in parallel between source code, Tokens, and Blockchain with regulated traditional financial forms.
Ripple's proactive approach to this trend is seen as an important signal, marking a legal transformation for the U.S. digital finance sector.
"We are witnessing the integration of traditional finance and Blockchain technology, opening a new chapter for digital banking."
Dr. Linh Nguyen, Digital Finance Expert, 2024
Frequently Asked Questions
How does the EGRPRA review affect the banking industry?
EGRPRA helps update and eliminate outdated regulations, facilitating the development of digital finance and new banking models in a modern and technology-compatible direction.
What does Ripple's application for a trust bank license mean?
This license allows Ripple to operate financial services based on Blockchain and Smart Contracts, not functioning as a traditional bank, paving the way for a digital finance model.
Can the Fed quickly approve Ripple's application?
Yes, under the regulations, the Fed has the authority to bypass the 90-day review process if it deems necessary to maintain financial stability and liquidity.
What will the results of the EGRPRA review be by 2026?
The United States may recognize digital financial organizations based on Blockchain, allowing the legal operation of digital banks and DeFi services.
Will these changes alter the current financial structure?
This is an important transformation step, creating inclusion between traditional finance and digital technology, ushering in a new era in the U.S. finance sector.
Source: https://tintucbitcoin.com/ripple-co-the-nhanh-chong-duoc-cap-phep/
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