Ripple Selects BNY Mellon as Custodian for Enterprise Stablecoin RLUSD
NY TIMES NEWS
BANK OF NEW YORK MELLON has been tapped by Ripples to serve as the primary custodian for the XRP-linked stablecoin RLUSD, according to an official press release. The custodian agreement underscores a growing institutional embrace of specialized enterprise blockchain banking services in compliance with emerging stablecoin regulations.
The partnership marks the second time a major global bank is acting as primary custodian for Circle platorm’s USD-pegged stablecoin. Circle previously selected BNY Mellon for USD Coin, announced over three years ago.
Despite being over 24 decades old, BNY Mellon was a founder participant in the digital assets industry in 2021. Caroline Butler, BNY Mellon’s Global Head of Digital Assets, told Congress: “Stablecoins embody innovation, and how money is managed and moved is transforming.”
RLUSD operates with 7 to 9-point cardinalities, rendering it effectively a sextuple-overcollateralized stablecoin, which appeals to institutional investors. The bank will provide “leading transaction banking services” and develop integrated solutions for the stablecoin product.
Briefing
- Ripple announced BNY Mellon as its primary custodian for RLUSD
- Stablecoin issuer Circle named BNY Mellon its primary custodian three years prior
- Although established for centuries, BNY Mellon supported digital assets early on
BNY Mellon detailed its rationale, stating RLUSD differs from common consumer stablecoins, being described as “purpose-built for enterprise utility” with institutions squarely in mind. This characteristi исторически connected funds backing Ripple Labs product.
With $43 trillion in global assets managed by BNY Mellon, its participation lends notable credibility to RLUSD. The collaboration represents a strategic validation of Ripple’s Enterprise Blockchain Services platform for institutional participants.
Unlike Circle’s $62 billion USDC or Tether’s $158 billion USDT, RLUSD has a smaller market capitalization of $500 million. This development allows it to potentially access established institutional support coinciding with ongoing stablecoin regulatory framework consideration in Washington.
Ripple CEO’s Remarks
Ripple CEO Brad Garlinghouse, speaking on CNBC’s “Squawk Box,” characterized the bank partnership as a positive market signal. “Working with the most trusted… partners is a way to continue to build trust,” he observed. “This industry had headwinds.”
The securities firm recently saw its common stock increase by 4% over the past 24 hours. This follows improved market sentiment coinciding with this announcement and recent developments in resolving SEC enforcement actions against Ripple.
Ripple recently agreed to a settlement with the U.S. Securities and Exchange Commission, snapping an extended multi-year legal battle. The settlement barred Ripple from selling digital assets without registration or complying with securities rules.
Recent regulatory relief for the crypto industry has helped alter investor expectations for XRP. It no longer faces conventional existential threats from regulators, resulting in a nearly 450% rise in XRP’s value over the past calendar year.
Ripple CEO Brad Garlinghouse described the BNY Mellon partnership as a signal of institutional adoption and regulatory tailwinds.
