- Ripple President predicts U.S. banks will launch tokenized asset projects in 2025, pending regulatory clarity.
- Trump plans to repeal SAB 121, removing crypto policy hurdles for banks to hold digital assets without liability concerns.
- Increased bank involvement in crypto custody could boost liquidity, stabilize markets, and accelerate digital asset adoption.
Ripple President Monica Long has expressed optimism regarding the expansion of tokenized assets in the U.S. banking sector by 2025. Long’s remarks came as significant regulatory developments unfolded, including the anticipated repeal of the crypto policy known as SAB 121.
Notably, this policy required banks to classify digital assets as liabilities, creating barriers for financial institutions engaging with cryptocurrencies. With the incoming administration led by President-elect Donald Trump, a shift in crypto regulations is expected.
In addition, Trump is likely to prioritize the repeal of SAB 121 through an executive order upon taking office. This change could open doors for banks to confidently explore crypto custody services and tokenized asset projects without the restrictions imposed by the policy.
Tokenized Assets Gain Momentum in the Banking Sector
Intriguingly, Monica Long highlighted that 15 of the world’s top 25 banks have already piloted tokenized asset initiatives. She anticipates that several U.S. banks will launch market-ready offerings in 2025 if regulatory clarity is achieved. Ripple’s President emphasized that this clarity is crucial for driving broader adoption of tokenized assets within the financial industry.
Consequently, the expected policy changes could significantly impact the U.S. banking sector, encouraging more banks to enter the crypto space. Long believes that the removal of regulatory hurdles will foster innovation and allow financial institutions to leverage tokenized assets effectively.
Trump Administration to Reshape Crypto Regulations
Additionally, Trump’s administration is expected to introduce a transformative crypto regulatory framework. Financial analyst Frank Chaparro noted that repealing SAB 121 will encourage major financial institutions to enter the crypto custody space. This move could improve market liquidity by introducing credit into the system, benefiting the cryptocurrency sector as a whole.
Similarly, Chaparro also suggested that increased liquidity might help stabilize the volatile crypto market. This would create a more robust financial ecosystem for both investors and institutions. Such developments could also enhance the adoption of cryptocurrencies like Ripple’s XRP, which has faced challenges due to ongoing regulatory scrutiny.
Industry Prepares for Broader Adoption
Moreover, the anticipated regulatory clarity is seen as a turning point for the crypto industry. With banks embracing tokenized assets and offering custody solutions, the market structure could experience a significant shift.
Additionally, the appointment of Scott Bessent as the next U.S. Treasury Secretary has sparked discussions about further policy changes.
In a letter to Bessent, Senator Elizabeth Warren raised concerns about crypto regulations, emphasizing the need for stringent oversight. The coming years are likely to witness debates and decisions that shape the future of the crypto landscape in the U.S.
