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Standard Chartered announced on October 12 that institutional custody for Ripple USD (RLUSD) on the XRP Ledger is live through its branch in the Dubai International Financial Centre (DIFC). The service is available to eligible institutional clients and is regulated by the Dubai Financial Services Authority.
Custody Service Launches in Dubai
The bank confirmed that the custody service is operational for eligible clients. This development allows institutional investors to hold RLUSD through a regulated banking entity in the DIFC jurisdiction. The DIFC branch operates under the oversight of the Dubai Financial Services Authority, providing a specific regulatory framework for the custody of digital assets.
The launch distinguishes itself from typical exchange listings by focusing on the secure holding of the stablecoin. For institutional participants, the ability to store digital dollars in a regulated environment is a prerequisite for broader adoption. The service addresses the need for a trusted custodian for RLUSD, a stablecoin issued by Ripple on the XRP Ledger.
Collateral Model Remains Pending
Alongside the live custody service, Standard Chartered is working with Ripple and LMAX Group on a separate collateral model. This proposed arrangement would allow the value of eligible RLUSD holdings to be mirrored to a trading venue without transferring the underlying tokens directly to that venue.
The design aims to reduce the operational friction of moving assets between custodians and trading venues when trading capacity changes. By mirroring value rather than moving tokens, the model seeks to streamline the process for large trading firms. However, this collateral integration is not yet live. It remains subject to documentation, testing, approvals, and jurisdictional conditions.
The distinction in timing between the live custody service and the pending collateral arrangement is significant. Reporting the entire plan as fully operational would overstate the current status. The collateral component requires further regulatory and operational steps before it can be utilized by clients.
Operational Factors for Institutional Use
The arrangement highlights the difference between holding a stablecoin and using it as trading collateral. For large trading firms, collateral mobility, exposure to counterparties, and operational control are key factors in determining whether digital dollars are used at scale.
A stablecoin’s appeal depends on where it can be safely held and pledged, as well as the speed at which it can be transferred. The Standard Chartered initiative addresses both the custody and potential collateralization aspects, but the latter is still in the planning and approval phase. The bank’s move positions it to support institutional demand for RLUSD, provided the collateral model clears the necessary regulatory and technical hurdles.
Frequently Asked Questions
Is Standard Chartered’s RLUSD collateral integration live?
No, the collateral integration is not yet live. It remains subject to documentation, testing, approvals, and jurisdictional conditions, while the custody service is already operational.
Which regulator oversees the DIFC branch?
The DIFC branch is regulated by the Dubai Financial Services Authority.
