BNY Adds XRP and RLUSD to Its Crypto Custody Platform

BNY, which oversees $63.4tn of client assets, now lets eligible institutional clients hold XRP and Ripple’s RLUSD stablecoin with the bank. In a joint announcement on 27 October, published on BNY’s newsroom and Ripple’s press page, the two companies said BNY “now supports XRP, the native digital asset of the XRP Ledger, and RLUSD on its Digital Asset Custody platform”.

Clients can use the service to “safekeep, hold and transfer digital assets”, the release says. The companies also set out plans to let BNY clients create and redeem RLUSD directly through the bank, and to look at putting trade finance on the XRP Ledger, a public blockchain. Those parts are not yet in place.

In brief

Eligible BNY institutional clients can now hold and transfer XRP and RLUSD in the bank’s digital asset custody.
BNY intends to let clients mint and redeem RLUSD directly, subject to final BNY and regulatory approvals.
Ripple and BNY are exploring a supply chain finance project with C2FO on the XRP Ledger.

What BNY clients can do now

BNY already holds the reserves behind RLUSD as its primary reserve custodian, and has a custody relationship with Ripple Prime, Ripple’s prime brokerage business. The new step adds the tokens themselves. Custody means safekeeping: institutions that would rather not manage the digital keys controlling their crypto pay a custodian to hold them securely. BNY says its platform keeps these assets “within the governance, controls and resiliency of its broader servicing model”.

RLUSD is a dollar stablecoin, a token designed to stay worth one US dollar. The release puts its market value at about $2.5bn and says the XRP Ledger has processed more than 4.6 billion transactions since launch, settling in about three to five seconds.

“We’re moving past the initial issuance of assets onchain – now, it’s all about making these tokenized assets usable for payments and collateral across financial markets,” said Monica Long, president of Ripple, in the release.

Carolyn Weinberg, BNY’s chief innovation and market transformation officer, said: “Future market infrastructure will deliver connectivity across payments, liquidity, collateral and securities, driven by architected bridges between traditional scaled systems and always-on blockchain technology.”

What is planned, and what is still being explored

BNY “intends to broaden its support for tokenized assets and investment products issued on the XRPL as institutional use cases on the ledger continue to develop”. It also intends to work with Ripple so that BNY clients can mint and redeem RLUSD directly through the bank. A footnote says all such plans “are subject to final BNY and regulatory approvals”. No dates were given.

The two companies also “intend to advance tokenized trade finance on the XRPL, subject to client requirements”. Tokenised trade finance puts existing assets such as unpaid invoices on a blockchain, which the release says could widen investor access to them. As a first step, Ripple and BNY are exploring a supply chain finance initiative with C2FO, a working-capital platform. Ragui Selwanes, president and chief operating officer for the Americas at C2FO, said the firm was “excited to explore” a new model for financing approved receivables.

A busy week for RLUSD

The announcement lands days after Ripple said it had won final approval from the Office of the Comptroller of the Currency for its trust bank, which will look after RLUSD’s reserves. Moody’s has since rated RLUSD A2, while flagging that holders would lack a direct claim on the reserves if the issuer failed. Standard Chartered already offers RLUSD custody through its Dubai branch, and Ripple says Robinhood will add RLUSD to its app.

Why a custodian matters more than a listing

For a stablecoin chasing institutional money, a large custodian is worth more than another exchange listing. Many large investors prefer, or are required, to keep assets with a regulated custodian, so BNY’s support removes a practical barrier for its own clients. It also means one bank now holds both RLUSD’s reserves and, for those clients, the tokens themselves.

The live part of the deal is narrow, though. Holding XRP and RLUSD is a service; using them is where the money is. Long’s own words make that point, and the useful pieces, direct minting through BNY and trade finance on the ledger, are still intentions that need approvals or client demand. BNY’s own tokenised Treasury repo with Citadel Securities ran on the bank’s private ledger. Putting client assets on a public chain such as the XRP Ledger would be a bigger step, and BNY has made no promise of when.

The plan to mint RLUSD directly through BNY is the one to watch. If it wins approval, institutions could swap dollars for RLUSD inside their existing banking relationship, without going to Ripple first. BNY gave no timetable; the next sign will be an approval or a launch notice from either company.