What rules govern lending against XRP, and how do bank capital rules treat it?

The full answer

Two different rule sets touch lending against XRP. Banks answer to capital rules, which set how much of their own money must stand behind each asset. Lenders outside the banking system answer to their own collateral terms and to the lending and securities rules of each country. The rules in the first set are documented in detail, while those in the second set are only partly documented.

What capital rule applies when a bank holds XRP?

The Basel Committee’s cryptoasset standard, SCO60, was finalised in July 2024 and took effect on January 1, 2026, according to The Industry Spread (May 29, 2026) [1]. It sorts every cryptoasset a bank holds into one of two groups [1]. Group 1 covers tokenised traditional assets and stablecoins that pass a redemption-risk test and an issuer test. These broadly receive the same capital treatment as the underlying asset, plus add-ons [1]. Group 2 covers everything that fails those tests, including unbacked crypto such as bitcoin and ether [1].

Group 2 splits again. Group 2a allows limited hedging recognition for assets with liquid derivatives markets, and Group 2b does not [1]. The Industry Spread reports that Group 2b assets receive a flat 1,250% risk weight, the maximum in the Basel Framework. The weight applies to the greater of a bank’s aggregate long or short position, so hedges do not reduce the charge [1]. At an 8% minimum capital ratio, a $100 position consumes $100 of capital [1].

The standard also caps exposure. A bank’s aggregate Group 2 holdings may not exceed 2% of its Tier 1 capital. Breaching a 1% soft trigger pushes the entire Group 2 book into the 2b treatment [1].

Which group would XRP fall into?

The Industry Spread does not name XRP. XRP is neither a tokenised traditional asset nor a stablecoin, so under the definitions above it would sit in Group 2. Whether a given bank’s XRP sits in 2a or 2b depends on the hedging-recognition criteria and on the size of that bank’s Group 2 book. Any bank whose Group 2 holdings pass 1% of Tier 1 capital would see the whole book treated as 2b.

The Industry Spread describes the severity as deliberate. It reports that the standard channels bank involvement toward custody, tokenised Group 1 assets and client brokerage rather than proprietary holdings, the outcome the Committee intended [1].

Does the Basel rule apply the same way in the US, the EU and the UK?

No. The Industry Spread (May 29, 2026) reports three different paths [1]:

• EU: Article 501d of CRR3 has applied a temporary crypto treatment since July 9, 2024. It stays in place until the European Commission adopts a permanent regime in line with the Basel text.
• UK: The PRA has committed to implement Basel and keeps discretion over calibration and timing.
• US: The administration rejected SCO60 through Executive Order 14178 and the July 2025 Digital Assets Report. It called the fixed 1,250% weight “anti-innovation” and “anti-competitive”. It directed federal banking agencies to build a risk-based framework in which capital reflects observed volatility, liquidity and correlation.

The same source says the Federal Reserve, OCC and FDIC are expected to propose that alternative through a working group [1]. It gives an example: a global bank could book the same bitcoin exposure at the full 1,250% cost in Frankfurt and at a weight still to be set in London. Once US rules land, the same exposure could carry a potentially far lower charge in New York [1]. The Basel Committee itself agreed in November 2025 to expedite a targeted review of parts of the framework, with stablecoin growth as the trigger [1].

How the rules apply in Canada and other countries is covered on the page about how XRP is regulated outside the US.

The UK’s Prudential Regulation Authority has committed to implement Basel but keeps discretion over calibration and timing [1].

At the report’s date the US rules had not arrived: it describes a potentially far lower charge in New York “once US rules land” [1].

Is permission to custody XRP the same as favourable capital treatment?

No. Custody rules decide what a bank may do with customers’ assets. Capital rules decide what a bank’s own holdings cost it. Sullivan & Cromwell reported in May 2025 that OCC Interpretive Letter 1184, issued May 7, 2025, lets national banks buy and sell assets held in custody at the customer’s direction [3]. The same letter lets banks outsource crypto custody and execution to sub-custodians, subject to third-party risk management [3]. The page on whether US banks can now custody crypto covers those permissions in more detail.

Ripple’s own bank charter follows the same line. On December 12, 2025, the OCC granted Ripple National Trust Bank preliminary conditional approval [2]. The proposed bank would provide collateral-trustee services and crypto custody in a fiduciary capacity, and it must limit its operations to those of a trust company [2]. The OCC letter requires at least $11.7 million in tier 1 capital and states that the bank will not be an insured depository institution [2]. Final approval to begin business will not be granted until all preopening requirements are met [2]. The approval expires if capital is not raised within 12 months or the bank does not open within 18 months. By my count, those dates are December 12, 2026 and June 12, 2027 [2].

A charter to hold assets for others and act as collateral trustee says nothing about the capital charge on XRP that a bank holds for itself. That charge is set by the capital framework described above.

The OCC’s letter of December 12, 2025 gave Ripple National Trust Bank preliminary conditional approval [2].

The letter describes the collateral trustee role as serving RLUSD holders, not XRP lending [2].

What rules apply when a non-bank lends against XRP?

Outside banks, the terms are set lender by lender. crypto.news reported on July 8, 2026 that Ripple Prime accepts XRP as collateral for margin and settlement within its own brokerage [4]. It called that collateral real but largely internal [4]. ICObench reported in May 2026 that a $200 million revolving facility with Neuberger Specialty Finance gives Ripple Prime balance-sheet capacity to fund client positions backed by that collateral pool [5].

ICObench also set out what collateral eligibility involves in prime brokerage: custody agreements, defined haircuts, real-time valuation, liquidation procedures and risk-committee approval at every counterparty in the chain [5]. crypto.news wrote that, for collateral demand to matter at scale, firms other than Ripple would need to accept and hold XRP as margin. It said that needs legal certainty of commodity classification plus approval from those firms’ risk committees [4]. How much a lender advances against XRP is covered on the page about haircuts and loan-to-value. The record of past crypto lenders is on the page about XRP held with lenders that collapsed in 2022.

As of October 3, 2026, I found no public source setting out which US or Canadian lending, money-transmission or securities rules apply to non-bank lenders offering loans against XRP. That gap is listed under what is not yet known.

Where does the evidence point the other way?

Three findings cut against the view that rules keep XRP out of lending. First, the US has rejected the fixed Basel weight. The Industry Spread (May 29, 2026) reports that a US charge could end up far lower than the EU one once rules land [1]. Second, the Basel Committee is reviewing its own standard [1]. Third, XRP is already accepted as collateral at Ripple Prime, crypto.news reported in July 2026 [4].

Each has a limit. The source reads the Basel standard against US Executive Order 14178 and the July 2025 Digital Assets Report [1]. The Basel Committee agreed a targeted review in November 2025 [1]. The page on whether XRP is already used as collateral sets out the evidence for current use. The tests an institution applies are on the page about whether XRP meets the tests for institutional collateral.