Ripple’s Banking License Clash Triggers XRP Turbulence—$7 Still in Sight?

Ripple Faces Setback as 42 U.S. Banks Oppose Banking License, Sparking XRP Price Volatility

Ripple Labs, the blockchain firm behind the XRP cryptocurrency, is under renewed scrutiny following a formal objection by 42 major U.S. banks against its application for a banking license in the United States. The move, led by the influential Bank Policy Institute (BPI), has sent ripples across both the financial and crypto sectors, sparking increased volatility in the price of XRP and raising questions about the future of Ripple’s ambitions to operate as a regulated financial institution.

Banks Push Back on Ripple's Banking Ambitions

The objections come at a pivotal time for Ripple, which has been actively expanding its services beyond traditional crypto remittances. The firm has applied for a license to operate as a U.S. bank, an effort that would allow it to offer digital asset services, including stablecoin settlements via its native $RLUSD token and direct access to the Federal Reserve's payment rails.

Source: X

However, the BPI, representing financial titans such as JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, Goldman Sachs, and Morgan Stanley, argues that Ripple's inclusion in the U.S. banking system poses significant systemic risks. In a joint statement, the group expressed concerns that the introduction of a blockchain-powered financial entity could "destabilize the settlement ecosystem" and "pose unresolved regulatory gaps that threaten market integrity."

Is Fear Driving the Opposition?

Despite the formal tone of the objections, several crypto industry analysts suggest the resistance may stem from competitive fear rather than legitimate regulatory concerns. Ripple’s proprietary technology enables fast, low-cost cross-border payments and settlement solutions that could undercut the traditional correspondent banking system. Its native stablecoin infrastructure, designed to facilitate on-chain dollar transfers, is seen as a direct challenge to banks’ monopoly over transaction infrastructure.

"When you have 42 banks uniting against a single blockchain project, it's no longer just about risk; it's about maintaining control," says Matthew Shields, a digital finance expert at Stanford University. "Ripple's ambitions threaten to redefine how capital moves globally, and incumbents are not ready to give up that ground."

The Ripple Effect: XRP Market Shows Early Signs of Impact

Shortly after the news of the coordinated pushback, XRP’s price began to show signs of volatility. At press time, the token is trading at $2.95, down 2.81% in the past 24 hours, with a 24-hour trading volume exceeding $5.45 billion. While the dip is modest compared to historical corrections, it underscores investor unease about the regulatory headwinds Ripple is now facing.

Technical indicators provide a nuanced picture. On the TradingView daily chart, XRP's Relative Strength Index (RSI) hovers around 49.52, placing it in neutral territory. The MACD histogram remains in bearish alignment, though red bars are shrinking—suggesting waning downward momentum. Key support levels are noted at $2.50, while short-term resistance lies in the $3.10 to $3.12 range.

Should XRP break above $3.10 with strong volume, analysts anticipate a potential rally toward $3.50 or even $4. However, failure to breach resistance could send prices back down to retest the $2.50 level.

Banking License Objection: A Sign of Weakness or Strength?

While the mainstream interpretation of the objection paints a grim picture for Ripple, others argue that such intense scrutiny is a sign of its growing relevance. Ripple has emerged as one of the most institutional-focused blockchain firms, forging partnerships with financial entities across Asia, Europe, and the Middle East.

"This objection could ironically work in Ripple’s favor," notes crypto legal analyst Jennifer Ortiz. "It signals that the company is getting closer to integrating within the existing financial framework—a position that, if achieved, could dramatically improve its long-term valuation and legitimacy."

Ripple executives have not released an official response but are expected to address the matter in the upcoming XRP Global Finance Summit in September.

Price Prediction: Is a $7 XRP Still Possible in 2025?

Despite the current turbulence, many investors remain bullish on XRP's long-term outlook. Historical price patterns offer reasons for optimism. Between July and November 2024, XRP experienced a downward trend, only to stage a remarkable 585% rally in the months that followed. The first half of 2025 saw consolidation, but a post-July breakout has already generated a 70% year-to-date return.

Given this backdrop, some market watchers predict that XRP could reach as high as $7 before the end of 2025, especially if Ripple successfully navigates regulatory challenges and secures its banking license.

"The markets are not just reacting to the objection; they're reacting to what it represents," says crypto market analyst Rajiv Khanna. "A fully regulated Ripple bank could transform the digital asset landscape, and those betting on long-term utility are unlikely to be dissuaded by short-term volatility."

Ripple’s Broader Strategy: Disruption in Motion

Beyond licensing hurdles, Ripple has been steadily expanding its ecosystem. It recently launched a pilot program for tokenizing real-world assets, such as government bonds and commodities, on its XRPL ledger. Additionally, RippleNet’s international payment corridors now span over 70 countries, highlighting its momentum in emerging markets.

Source: Crypto King

Analysts believe that Ripple’s broader strategy is centered not just on becoming a crypto-first bank but on reshaping the very foundations of cross-border finance. With central bank digital currencies (CBDCs) gaining traction globally, Ripple has positioned itself as a technology provider to multiple central banks, further cementing its relevance.

Looking Ahead: What’s Next for XRP and Ripple?

As regulatory dynamics continue to evolve, Ripple’s trajectory will likely hinge on its ability to maintain strategic partnerships, secure licensing, and sustain its pace of innovation. For XRP holders, the coming months may be marked by heightened volatility, but also the potential for transformative gains.

Whether the 42-bank blockade marks the beginning of the end or a new chapter in Ripple’s journey remains to be seen. For now, one thing is clear: Ripple is no longer just a crypto company. It is a direct contender in the future of global finance.

Writer @Erlin

Erlin is an experienced crypto writer who loves to explore the intersection of blockchain technology and financial markets. She regularly provides insights into the latest trends and innovations in the digital currency space.

 

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