Standard Chartered Offers RLUSD Custody in Dubai and Plans LMAX Collateral Link

Ripple had previously provided LMAX with $150 million in funding to integrate RLUSD into its institutional infrastructure.

Global banking giant Standard Chartered is now offering institutional custody of Ripple's dollar-denominated stablecoins on the XRP Ledger through its Dubai branch, offering eligible clients a regulated bank to hold dollar-denominated stablecoins.

With nearly $450 billion in assets under management, the bank also plans to partner with Ripple and LMAX Group, an institutional trading venue for digital and currency assets, so clients can use RLUSD held at Standard Chartered as collateral for trading on the LMAX platform. That part of the arrangement has not yet been activated and is still subject to documentation, testing, regulatory requirements and internal approvals, the bank said in an email on Monday.

LMAX plans to allow clients to use RLUSD held at Standard Chartered to support trades, so they do not need to transfer the stablecoin to the venue.

This could be attractive to banks, funds and other institutions that want to trade in stablecoins but don't want to leave assets on a trading venue. It separates custody from execution: the bank holds the tokens and the venue accepts their value as collateral.

"A regulatory custody attached to a systemically important global bank is becoming one of the most valuable infrastructures in digital assets," said Joseph Goh, head of Asia-Pacific at Singapore-based cryptocurrency investment bank Arta.

"Institutional clients want to participate in digital asset markets without compromising how they protect their assets or how they manage risk," said Waqar Chaudry, Global Head of Digital Assets, Securities Services and Standard Transaction Services at Chartered.

The move is based on Ripple's efforts to position RLUSD as a settlement and collateral asset for institutions. As part of plans to embed the stablecoin into the group's infrastructure, including for institutional trading, Ripple provided LMAX with $150 million in funding.

The LMAX link, if completed, would give RLUSD another route to the collateral systems behind institutional trades, rather than limiting the token to payments or cash settlements.

Standard Chartered is expanding its custody operations in several financial centers. Last week, the company announced plans to offer institutional clients in Singapore custody for select cryptocurrencies, stablecoins and real-world tokenized assets, having fully acquired Zodia Custody earlier this year. It was the first bank to issue one of Hong Kong's two regulated stablecoins in August.

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