Standard Chartered brings Ripple’s RLUSD into banking custody after $765 million quarterly surge

Standard Chartered has introduced custody services for Ripple’s RLUSD stablecoin, laying the groundwork to expand its application as trading collateral for institutional clients.

The bank revealed on Oct. 12 that qualified institutional customers can now store XRPL-issued RLUSD through its Dubai International Financial Center office, which operates under the oversight of the Dubai Financial Services Authority.

This rollout constitutes a key component of a wider collaboration alongside Ripple and trading firm LMAX, designed to let institutions utilize RLUSD as collateral while maintaining their stablecoin storage at Standard Chartered.

Within this proposed framework, the institution intends to mirror the worth of qualifying RLUSD balances to LMAX, permitting clients to back trading positions without needing to transfer the underlying tokens straight to the platform.

Such a system aims to cut down counterparty exposure and operational hazards linked to transferring assets between exchanges and custodians, while granting institutions the ability to deploy capital efficiently across trading operations.

Ripple broadens RLUSD institutional footprint following swift supply expansion

This milestone arrives as RLUSD establishes itself as a frontrunner among stablecoins regarding absolute market value growth, showcasing Ripple’s push to widen its presence throughout financial markets.

Data provided by the RWA Foundation indicates that Ripple posted the second-greatest rise in stablecoin market capitalization throughout the third quarter, taking in $765.3 million across a 90-day span.

Circle’s USDC secured the top spot with a larger growth of $915 million, whereas United Stables took third place by adding $474.2 million.

Figures sourced from DeFiLlama indicate that the total circulating supply of RLUSD has subsequently risen to approximately $2.4 billion, featuring around $1.14 billion minted on the XRP Ledger and an additional $1.3 billion located on Ethereum.

This growth equips Ripple with an expanded reserve of dollar-pegged tokens as the firm aims to position RLUSD beyond basic payments and transfers, targeting uses such as institutional trading collateral.

That strategic push gained traction back in January when Ripple and LMAX unveiled a multiyear partnership meant to embed RLUSD across the trading firm’s ecosystem.

Ripple allocated $150 million in funding to back LMAX’s growth, with the pact focusing on driving RLUSD adoption across spot crypto trading, perpetual futures, contracts for difference, and other institutional instruments.

Standard Chartered’s participation introduces a conventional banking custody route into the partnership, enabling participating institutions to secure their custody needs with the bank while accessing the trading infrastructure provided by LMAX.

Waqar Chaudry, who serves as Standard Chartered’s global head of digital assets in Securities Services, noted that institutional investors show a growing desire to engage with digital asset markets without sacrificing risk management and asset protection.

For Ripple, supporting RLUSD as trading collateral has the potential to spur extra demand coming from investment firms, brokers, and banks that require dollar-denominated assets to back their trading activities.

Even so, the ultimate commercial effect hinges on the extent to which institutions embrace the system and which specific LMAX products end up supporting the stablecoin.

As of now, Standard Chartered has kept details private regarding the volume of RLUSD kept in custody and has not named any participating institutional clients.

Furthermore, the firms have yet to disclose a launch date for when the collateral integration goes live. Actual deployment depends on final documentation, technical tests, regulatory compliance, and internal approvals across all impacted jurisdictions.

These pending procedures will dictate precisely when institutions will be permitted to leverage RLUSD stored at Standard Chartered to support their trading positions on LMAX.

?Frequently Asked Questions

01What is RLUSD?

RLUSD is a stablecoin issued by Ripple that has experienced rapid supply growth, with circulating supply climbing to about $2.4 billion across the XRP Ledger and Ethereum.

02What role does Standard Chartered play in this arrangement?

Standard Chartered has launched custody services for RLUSD through its Dubai International Financial Center branch, allowing eligible institutional clients to hold the stablecoin and use it as collateral for trading on LMAX without moving the underlying tokens.

03When will the collateral integration become operational?

The exact launch date has not been announced, as implementation depends on final documentation, technical testing, regulatory requirements, and internal approvals.