U.S. President Signs Executive Order to Replace FedNow with Blockchain-Based XRP Payment System

Washington, D.C. — In a historic and unexpected move, the President of the United States has signed an executive order directing the replacement of the Federal Reserve's recently launched instant payment system, FedNow, with a new blockchain-based infrastructure powered by XRP, a digital asset developed by Ripple Labs. This sweeping decision marks a significant shift in the country’s financial technology strategy, setting the stage for one of the most radical transformations in the U.S. payments landscape in decades.

A Landmark Moment in U.S. Financial Policy

The executive order, signed earlier this week at the White House, calls for the gradual phase-out of FedNow and the full-scale adoption of a decentralized payment architecture, leveraging the XRP Ledger as the backbone for near-instant, low-cost domestic and cross-border transactions.

The order cites reasons such as greater transaction efficiency, improved security, cost reduction, and enhanced global competitiveness as driving factors for the switch. It also aligns with the administration’s broader push toward embracing next-generation financial technology to ensure the United States maintains its leadership position in the global digital economy.

"The United States must remain at the forefront of innovation in financial infrastructure," the President stated during a press briefing. "The transition to blockchain-based payments is not just inevitable — it’s imperative. Today, we take a decisive step forward by integrating XRP as the foundational layer of our national payment system."

Why XRP?

XRP has long been recognized in the crypto industry for its utility in facilitating real-time, low-cost international transfers. Unlike Bitcoin or Ethereum, which primarily function as store-of-value or smart contract platforms, XRP was designed with the explicit purpose of serving as a bridge currency for financial institutions and remittance providers.

Ripple Labs, the company behind XRP, has already established partnerships with major banks and payment corridors around the world. Its XRP Ledger processes transactions in approximately 3-5 seconds with minimal fees, making it an attractive alternative to traditional banking rails that can take days to settle transactions.

The executive order praised these attributes, stating that the XRP Ledger offers “unmatched scalability and real-time settlement capabilities, well-suited for a modern and inclusive financial ecosystem.”

What Happens to FedNow?

The FedNow system, officially launched in 2023 by the Federal Reserve, was originally introduced to enable instant payments between banks and financial institutions in the U.S., 24/7. However, critics of the system argue that its functionality has been limited, with relatively low adoption among smaller banks and a lack of international interoperability.

According to the executive order, FedNow will continue to operate for the next 12 months during the transition phase, allowing institutions and businesses to migrate their infrastructure to integrate with the XRP-based system.

After that period, FedNow operations will be suspended, and the Federal Reserve will assume a supervisory role over the newly formed Digital Asset Payments Oversight Council (DAPOC) — a multi-agency body designed to monitor and regulate blockchain-based transactions involving U.S. citizens and corporations.

Ripple Labs Responds

Ripple Labs, the developers of XRP and the XRP Ledger, released a public statement shortly after the announcement, expressing support for the decision and reaffirming their commitment to regulatory compliance and technological excellence.

“We are honored to see the utility of the XRP Ledger recognized at the highest levels of government,” said Brad Garlinghouse, CEO of Ripple. “This is not just a milestone for Ripple or XRP — it's a breakthrough moment for blockchain technology and financial inclusion in the United States.”

Ripple confirmed that it will work closely with federal agencies, financial institutions, and developers to ensure a smooth and secure nationwide integration of its payment protocols.

Impact on Banks and Financial Institutions

The adoption of XRP for national payment infrastructure could have significant implications for commercial banks, credit unions, and fintech companies. Unlike FedNow, which relied on traditional banking infrastructure, XRP enables direct peer-to-peer settlement over the blockchain, which could eliminate intermediaries in many cases and drastically reduce processing fees.

Banking associations have expressed both excitement and concern about the shift. The American Bankers Association (ABA) issued a statement requesting “clear regulatory guidance and technical support” as member institutions prepare to overhaul their payment frameworks.

Fintech companies, on the other hand, have largely welcomed the move, citing the greater flexibility and interoperability that comes with blockchain-based solutions.

“This levels the playing field,” said Aria Morgan, CTO of FinWise Payments, a California-based fintech firm. “Blockchain-based rails like XRP can finally open the door for smaller companies to compete with legacy giants in the payments sector.”

Global Repercussions

Beyond U.S. borders, the decision has sparked intense interest from central banks, regulators, and market analysts. While countries such as China have aggressively rolled out central bank digital currencies (CBDCs), the U.S. has until now taken a more cautious approach.

This new executive order may signal a change in strategy, positioning blockchain and digital assets as central to the nation’s monetary infrastructure — not just auxiliary tools.

Market observers have noted that XRP’s value surged sharply following the announcement, with trading volumes hitting record highs and major exchanges experiencing increased activity.

“This move puts the United States at the forefront of blockchain adoption in the public sector,” said Dr. Elaine Zhu, a senior economist at the Digital Currency Research Institute. “It will have ripple effects — no pun intended — on how other countries view blockchain integration in their financial systems.”

Concerns and Criticisms

Not everyone is convinced of the benefits. Critics argue that replacing a centralized system like FedNow with blockchain technology could expose the national economy to new forms of cyber risk, including potential vulnerabilities in the consensus protocol or attacks on validator nodes.

🚨‼️BREAKING NEWS 🚨‼️
🇺🇸The President of the United States signs an executive order to replace the FEDNOW system with a modern payment system using XRP for payments. pic.twitter.com/AtiXP2C8Xr

— Raphaël Ntamack π (Pi) (@RaphaelNta23933) June 6, 2025

Privacy advocates have also raised alarms about how transaction data will be handled under the new system. Although XRP transactions are pseudonymous, all records are permanently stored on a public ledger — a feature that could have implications for personal financial privacy if not managed carefully.

Civil liberty groups are calling for increased transparency and safeguards as the system is rolled out.

The Road Ahead

According to the executive order’s roadmap, the federal government will work with Ripple Labs and relevant industry stakeholders to:

• Establish technical integration standards by Q3 2025

• Begin pilot programs with select financial institutions by Q4 2025

• Achieve full operational rollout by mid-2026

Congress is also expected to debate new regulatory frameworks surrounding the use of blockchain technologies in public systems. Bipartisan lawmakers have already voiced support for further discussion and oversight to ensure responsible implementation.

A New Era in Payments

Whether viewed as a bold innovation or a risky experiment, the decision to replace FedNow with an XRP-powered payment infrastructure marks a watershed moment in American financial history. If successful, it could redefine how value moves across the United States and potentially set a precedent for other countries to follow.

The executive order symbolizes a growing recognition among policymakers that blockchain is not merely a trend — it is a tool for systemic transformation, capable of reshaping the global financial architecture for decades to come.

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