BNY Mellon to Custody Ripple’s Stablecoin: A New Era in Digital Assets
Ripple Partners with BNY Mellon for RLUSD Custody as Market Cap Surpasses $500 Million
BNY Mellon Selected as Primary Custodian for RLUSD
Ripple has officially chosen The Bank of New York Mellon (BNY) to serve as the primary custodian for its RLUSD stablecoin, which has recently achieved a significant milestone by exceeding a market capitalization of $500 million, as reported by CoinGecko. BNY Mellon stands as the largest custodian globally, managing an impressive $53.1 trillion in assets.
Enhancing Operational Efficiency and Connectivity
Emily Portney, the Global Head of Asset Servicing at BNY, expressed enthusiasm about the partnership, stating that the collaboration aims to enhance the growth and adoption of RLUSD. The bank’s extensive operational capabilities will facilitate the efficient transfer of reserve assets and cash, essential for supporting conversions. BNY’s established connections will streamline transactions involving Treasury bills and reverse repurchase agreements, making it an ideal partner for Ripple. Additionally, BNY has recently introduced support for intraday transactions, allowing for better management of Ripple’s cash reserves and improved access to payment systems.
Building Trust Through Independent Custody
While Ripple has the capability to manage its assets through its regulated trust subsidiary, Standard Custody and Trust, the partnership with BNY Mellon introduces an additional layer of credibility. Having an independent custodian overseeing funds can enhance confidence among stakeholders, ensuring that assets are safeguarded effectively.
Competing in the Stablecoin Market
Ripple aims for RLUSD to emerge as a leading enterprise stablecoin, particularly for cross-border transactions and institutional use. To achieve this goal, it must compete with established players like Circle. Notably, BNY Mellon already provides custody services for some of Circle’s cash and manages the Circle Reserve Fund, which is associated with BlackRock and actively participates in Treasury markets.
Future Developments and Regulatory Moves
In parallel, Standard Trust has recently sought a Federal Reserve master account, which would enhance its connectivity capabilities. Additionally, Ripple is pursuing a national bank charter, a move that could further solidify its position in the financial landscape. The implications of these developments for Ripple’s future are significant and warrant close attention.
