Ripple Labs CEO Brad Garlinghouse has slammed Wall Street banks for opposing crypto companies’ more direct access to the Federal Reserve system.
Garlinghouse specifically said that resistance to crypto firms obtaining a “Fed master account” is “hypocritical and anti-competitive.”
Speaking at the DC Fintech Week event, Garlinghouse stated that the crypto sector “should be held to the same standards” as traditional financial institutions when it comes to combating money laundering and illicit finance, adding, “If we’re talking about the same standards, then we should also have access to the same infrastructure. It’s inconsistent to say one thing and oppose the other.”
The Fed’s “master account” system allows institutions to directly integrate into the U.S. financial system and access central bank systems. However, many cryptocurrency companies have struggled due to the Fed’s reluctance to approve such accounts or uncertainty about how the process will work.
Ripple recently applied for a “master account” through its subsidiary, Standard Custody & Trust Co. The company also sought a federal bank license from the U.S. Office of the Comptroller of the Currency (OCC) in July.
Garlinghouse stated that they have recently held more constructive discussions with banks regarding Ripple’s stablecoin project, RLUSD:
“I had meetings yesterday in New York with banks that refused to talk to us three years ago. Now they’re asking, ‘How can we collaborate on this?’”
Ripple’s CEO argued that granting crypto firms a master account would provide greater stability, oversight, and risk management in the financial system. “It’s really disappointing that some traditional banks are lobbying against this,” he said.
*This is not investment advice.