The Bank of New York Mellon Corporation (BNY) (NYSE: BK)will provide custody for Ripple’s dollar-based stablecoin RLUSD.
Congressional legislation providing clarity on the regulation of payment stablecoins is expected to be passed into law soon. This will mean the banks will feel more comfortable providing crypto services. Ripple, issuer of XRP, is looking to expand its services globally.
As the Trump Administration has embraced digital asset innovation in contrast to the hostile approach under former President Biden, the crypto sector has rushed to pursue vast opportunities in the sector like stablecoins.
Ripple notes that it is one of the few to offer a stablecoin regulated under a New York Department of Financial Services (NYDFS) Trust Company Charter, thus it already holds a heightened degree of oversight.
Jack McDonald, SVP of Stablecoins at Ripple, said RLUSD addresses a gap in the stablecoin market, as it is developed for “enterprise-grade financial use cases.”
Emily Portney, Global Head of Asset Servicing at BNY, stated that they are committed to providing secure and innovative solutions for the global financial ecosystem.
Under the pending legislation, issuers of stablecoins are required to maintain a 1:1 parity with assets such as fiat currencies and treasuries. As stablecoins can provide immediate value transfer, these digital assets are poised to become the new and improved payment rails. At the same time, dollar-based stablecoins should help maintain the dollar as the global reserve currency, which is good for the US.
