The crypto-community has been in a buoyant mood over the past few days owing to a recent decision taken by the United States’ Office of the Comptroller of Currency. The decision, encapsulated in an interpretive letter the OCC sent to an unnamed bank, stated that nationally chartered banks and savings institutions may now offer crypto-custody services to their clients. This is also a decision that opens the door to these institutions offering staking and crypto-lending services in the future.
As one would expect, the news was reciprocated happily by the crypto-market, with the resurgence led by none other than Bitcoin, the world’s largest cryptocurrency. In fact, Bitcoin was quick to breach its immediate resistance and at the time of writing, was well above $9,600 on the charts.
Ripple and the XRP community weren’t far behind when it came to celebrating the development. But, should they really? More importantly, are their reactions representative of those voiced by the rest of the community? The way to go about answering this question lies perhaps in identifying what the OCC’s decision actually means.
A fork in the road behind
Sure, the decision means that banks can offer crypto-custody services and may offer staking and lending services in the long-term, but at its most basic and most primitive, the development in question is a validation of Bitcoin, and by extension, the cryptocurrency market’s credentials.
Validation of Bitcoin. A cryptocurrency that was conceived back in 2009 with the intent to replace the existing financial and banking infrastructure. A cryptocurrency whose proponents have vocally and repeatedly propounded the idea of “Be your own bank.” The fact that such a cryptocurrency has been given the thumbs-up so publicly is as significant as anything this year.
However, “replacing the existing financial infrastructure,” “Be your own bank,” is that what Ripple has been saying all these years? Well, no. In fact, Ripple’s strategy has been more conciliatory. Instead of replacing the prevailing financial infrastructure, Ripple has leaned towards using the technical advantages afforded by blockchain and crypto to reform the system. Do you wonder why Ripple has been happy to work with financial institutions such as banks? Well, this is the reason.
Ergo, it is no surprise that many expect Ripple, and by extension XRP, to be the biggest winners of the announcement. Now, Ripple and XRP can finally be the solution to a $1 trillion problem, some say. No wonder the community has been quick to welcome and celebrate the OCC’s decision. That, and the fact that Brad Garlinghouse’s crypto-custody prediction from a few years ago seems to have come true.
But, think about it – Does Ripple celebrating the announcement of crypto-custody services ring hollow? Well, it might, because as pointed out previously, its journey hasn’t been the same as the rest of the crypto-community. In the eyes of many, Ripple is a compromise…