After a Long Legal Tug-of-War, Ripple Is Finally Catching a Break

Reports suggest that President Donald Trump's team is eyeing XRP as a key player in building a powerhouse Bitcoin (BTC) reserve.

After a lengthy legal battle that finally saw some progress under President Biden's administration, President Donald Trump's team is reportedly considering a unique proposal to utilize XRP in a massive Bitcoin (BTC) reserve initiative.

According to a new proposal submitted to the US SEC, including XRP in the US financial system could unlock $1.5 trillion in liquidity, which could then be used to buy Bitcoin. However, this idea faces major regulatory hurdles and it remains to be seen if the government will show any interest in it.

How XRP Could Free Up Trapped Funds

In a five-page proposal, Maximilian Staudinger suggests that the US should use XRP to free up capital currently trapped in Nostro accounts. These accounts, used for cross-border transactions, hold about $27 trillion globally, with around $5 trillion belonging to US banks. By using XRP, Staudinger believes that $1.5 trillion could be released each year and redirected toward Bitcoin purchases.

He also proposes a structured crypto reserve system for the US, with Bitcoin at the center and Solana and Cardano for government applications. However, he insists that XRP is the most important asset for handling financial transactions.

Bold Bitcoin Claims Raise Questions

One of the more questionable parts of the proposal is the claim that the US could buy 25 million Bitcoin at $60,000 per coin. This is impossible since Bitcoin’s total supply is only 21 million. Still, the proposal argues that using XRP could save the US up to $7.5 billion in transaction fees annually and make government payments, like Social Security and tax refunds, faster and cheaper.

Regulatory Challenges Stand in the Way

Despite its ambition, the proposal faces a big setback—XRP’s unclear regulatory status. Staudinger urges the SEC to classify XRP as a payment asset instead of a security. He also calls on the Department of Justice to lift restrictions preventing banks from using XRP.

To speed things up, he suggests a presidential executive order to bypass regulatory delays. His plan includes two timelines: a standard 24-month rollout with standard regulatory approval, government payments, and bank adoption, or opting for a fast-track 6-12 month timeline using executive orders and Fed mandates for quick XRP integration. While ambitious, the fast-track approach could work given Ripple’s existing global liquidity network.

While the idea itself is interesting, independent proposals like this usually don’t gain much traction unless backed by major financial institutions or government officials. Without strong support, this remains a bold idea rather than a plan that the US is likely to adopt anytime soon.