Ripple Breaks Down Stablecoin Rules as Institutions Evaluate RLUSD

Key Takeaways

• Ripple outlined how stablecoin licenses differ in holder protections.
• RLUSD’s proposed federal trust bank still requires final approval.
• CFTC collateral eligibility differs from ongoing issuer supervision.

Ripple Explains the Rules Behind RLUSD

Protections for stablecoin holders depend on the issuer’s actual license, reserve requirements, and supervision, Ripple argued in a Sept. 11 blog post. The digital asset infrastructure company outlined how money transmitter licenses, state trust charters, and federal supervision differ as institutions assess stablecoin Ripple USD (RLUSD) for payments, settlement, and treasury operations.

This distinction affects how dollar-backed tokens maintain their backing and how holders can exchange them for cash. Such stablecoins typically use reserves to support their dollar value, but reserve quality and redemption arrangements influence their risks. Ripple stated:

“A money transmitter license, a state trust charter, and prudential supervision by a banking regulator all involve government oversight, but they carry different capital requirements, different reserve rules, and different consequences if an issuer fails.”

RLUSD is issued by Ripple subsidiary Standard Custody & Trust Company under a New York Department of Financial Services limited-purpose trust charter. Its framework includes segregated reserves and independent attestations, which examine reserve disclosures. Ripple selected BNY as primary reserve custodian in July 2025 and said it would also use the transaction banking services of The Bank of New York Mellon Corp. (NYSE: BK).