Standard Chartered starts holding RLUSD in Dubai

Standard Chartered's Dubai branch now offers institutional custody of RLUSD, Ripple's dollar-pegged stablecoin, on the XRP Ledger. Eligible clients get a regulated bank to hold the token rather than an exchange or a crypto-native custodian.

The more interesting half is not live yet. The bank plans to work with Ripple and LMAX Group, an institutional venue for foreign exchange and digital assets, so that RLUSD held at Standard Chartered can serve as collateral for trading on LMAX without being transferred to the venue. The bank told CoinDesk on Monday that this part still depends on documentation, testing, regulatory requirements and internal approvals.

If it goes ahead, the arrangement separates custody from execution: the bank keeps the tokens, and the venue accepts their value as margin. That is the model institutions already use in traditional markets, and the one that keeps assets off a trading venue's balance sheet — the exposure that hurt clients of failed crypto exchanges.

Both sides have been building towards this. Ripple gave LMAX $150 million in financing in January to embed RLUSD in its infrastructure. Standard Chartered, which fully acquired Zodia Custody earlier this year, said last week it plans custody in Singapore for selected cryptocurrencies, stablecoins and tokenised real-world assets, and in August it became the first bank to distribute one of Hong Kong's two regulated stablecoins.

For Ripple, a bank custodian connected to a trading venue's collateral system is a route into institutional trading that payments alone do not give a stablecoin. For the bank, it is another market where it holds the asset while others compete to trade it.