Standard Chartered has started holding Ripple’s RLUSD stablecoin on the XRP Ledger, marking a significant move for the international banking group into crypto asset custody. The latest development was detailed by Dr. Kamilah Stevenson, an analyst specializing in wealth and banking, who described both the current custody process and new trading possibilities for institutional clients.
Institutional custody and proposed trading model
Standard Chartered’s RLUSD custody is managed through its branch at the Dubai International Financial Centre, regulated by the Dubai Financial Services Authority. The bank plans to extend its offerings through a partnership involving Ripple, the blockchain-focused payments operator, and LMAX, a platform providing institutional access to currency and cryptocurrency trading.
Under a solution described as “collateral mirroring,” Standard Chartered would maintain custody of institutional clients’ RLUSD. The bank would then communicate the amount of available collateral to LMAX, allowing clients to trade against these holdings without the need to transfer assets directly onto the trading platform. This approach could offer security benefits by reducing the exposure of client capital on external venues.
Dr. Stevenson noted that, while RLUSD custody is already operational, the trading feature involving LMAX is still under development and awaits further technical testing, legal assessments, and regulatory approval. As of now, it is not an active service.
Mini dictionary: LMAX is a UK-based financial technology firm providing institutional exchange services in FX, crypto, and other asset classes, aiming to offer efficient, transparent trading infrastructure for large-scale investors.
Clients would be able to keep their RLUSD with Standard Chartered, while trading against that collateral elsewhere, minimizing risks linked to asset transfers onto outside platforms. This system is not yet live, pending regulatory and legal review.
Impact on XRP and broader strategy
Dr. Stevenson indicated the arrangement is specifically focused on RLUSD, Ripple’s dollar-pegged stablecoin, rather than XRP itself. RLUSD is designed to maintain parity with the US dollar and operates natively on the XRP Ledger.
While the trading and custody processes utilize the XRP Ledger, they do not require meaningful amounts of XRP for operation. Accounts on the ledger must maintain small XRP reserves, and minimal transaction fees are paid in XRP, which are subsequently burned. However, these requirements do not equate to substantial demand for the XRP token.
Approving the XRP Ledger for custody purposes could pave the way for broader future services from the bank, but immediate effects on XRP demand remain limited unless upcoming financial products require more significant XRP holdings.
Dr. Stevenson linked the RLUSD custody service to Ripple’s wider business interests, such as collateralized lending and prime brokerage, indicating that the infrastructure for institutional-grade stablecoin custody could accelerate adoption of related services in the future. However, there is no confirmation that Standard Chartered will accept XRP as direct collateral at this stage.
Standard Chartered is a multinational financial institution headquartered in London, with a strong presence in Asia, Africa, and the Middle East. The bank’s expansion into digital asset services reflects growing institutional interest in tokenized assets and blockchain technology for traditional finance applications.
