You mean S/PDIF electrical cable with RCA connectors? Because Babyface has optical in/out which can be used directly for S/PDIF signal using standard optical S/PDIF cable with Toslink connectors, of course you should set optical in/out to s/pdif in the Fireface USB Settings.

There are many various devices which can convert optical Toslink out/in to electrical RCA out/in.
Just for example:
- Monoprice Optical Toslink to Coaxial (RCA) Digital Audio Converter at about 15$ on Amazon...
- C2G / Cables to Go 40019 Optical to Coaxial Digital Audio Converter (Black) abut 13$

There are probably some more professional (more expensive) converters if you wish

HI,
I was curious about the device, so I took a look at it's manual. Actually there is no need to connect VRM box to the BF, because the device itself can work as USB audio sound card with ASIO/Core_audio drivers . So if it is not very painful to change DAW audio out settings for the project (from BF to VRM box) I would rather not bother to put one more box just to make Digital to digital conversion from BF toslink out to VRM RCA in.... No audible benefit ,as VRM box will do Digital to analog conversion anyway whatever option you choose, but using RCA input you need another box in the middle...
Instead of such complex setup for mixing you can just set output to VRM asio/core_audio  USB driver.
The only drawback of this solution is to change audio out in the DAW whenever you need to listen through VRM box. If changing audio interface will not influence the track settings of your project, it should not be a real issue...
Putting an additional box  (which requires external power) gives you more mess on the desk and additional possible point of failure in the audio chain... BF -> Toslink to RCA digital to digital converter-> VRMBox

...this was my long opinion, but giving you short answer for the question, yes it is possible

Regards,
Greg

Basically if you are using digital output  from audio interface you are bypassing  its converters...
As the audio signal from computer is already sent in digital form thorough the USB interface to the audio card. Audio interface passess the digital audio signal to its digital signal matrix (mixer) and then still in digital form send it to the s/pdif output.

The same rules apply to the Babyface. When using it's s/pdif out BF is not influencing the (already) digital audio signal but it just passes it through. The VRMBox is the device which converts digital signal to the analog signal which  then you listen through your headphones. So there is no advantage of using babyface to send digital audio, especially if you need another digital to digital converter to make it possible... Take into consideration, that babyface will give you untouched digital signal but Toslink to RCA digital converter can introduce some distortions to the audio  (depending on its quality), so in the end it may happen that direct VRMBox can sound better then  BF->converter->VRMBox chain. Anyway direct VRMBox should not sound worse.

Of course one may say that BF has super extra low jitter circuity which is probably better then VRMBox one, yes indeed but VRMbox when taking signal from S/PDIF in is not synchronizing to the signal source but is using only its own internal clock source thus anyway it may introduce its own distortions to the received steady clock signal...

Conclusion:
1. If there is possibility that VRMBOx will degrade somehow the sound it will do it most probably on both: S/PDIF and USB  inputs because both feeds it with the digital signal which is then modified  by VRMBox DSP processors to simulate speakers and then converted to analog form and passed to headphone amplifier.

2. Using babyface gives no quality advantage as the signal is convetred to analog form only in VRMBox and this box uses its internal clock when receiving S/PDIF signal so takes no advantage from BF steady clock

3. The only advantage of feeding signal to VRMBox from S/PDIF is the possibility of not touching the DAW settings regarding interface outs, and maybe possibly to obtain shorter latency settings with BF drivers...