Ripple has partnered with BNY Mellon to serve as the primary custodian for the reserves backing its US dollar-pegged stablecoin, RLUSD, aiming to enhance regulatory compliance and institutional trust.

This partnership aligns with Ripple's broader efforts to integrate into the U.S. financial system, including applying for a national banking license and a Federal Reserve master account, to hold reserves directly and access payment rails.

Launched in December 2024, RLUSD is a stablecoin pegged 1:1 to the US dollar, backed by a segregated reserve of cash, short-term Treasuries, and money market funds, with regulatory approval from New York and Dubai.

RLUSD's market capitalization has surpassed $500 million, increasing over 30% in the past month, reflecting rising demand for enterprise-focused stablecoins.

This development is part of the ongoing 'stablecoin summer,' a trend where traditional financial institutions are increasingly engaging with stablecoins amid more favorable regulatory policies.

The partnership signifies growing institutional interest in stablecoins, as major players explore or develop digital assets in response to regulatory shifts.

Recent regulatory changes, such as the U.S. SEC's withdrawal of the SAB 121 guidance in January 2025, have eased restrictions on banks engaging in crypto custody, facilitating initiatives like this.

Market reactions have been positive, with BNY Mellon's stock rising and stablecoin adoption increasing by 140% year-over-year in 2025, indicating growing institutional confidence.

RLUSD is designed for enterprise-level cross-border transactions, offering faster settlement, lower costs, and improved efficiency compared to retail-focused stablecoins.

BNY Mellon emphasizes supporting digital asset growth through its specialized platform tailored for institutional needs, with the collaboration highlighting their extensive experience in digital infrastructure.

This move is part of a larger trend where major financial institutions like JPMorgan Chase, Goldman Sachs, BlackRock, and Fidelity are expanding their crypto custody and related offerings, reflecting broader institutional interest.

The partnership opens opportunities for financial institutions to profit from crypto through custody fees, trading, and asset management, indicating a future where stablecoin-backed assets become more prominent in portfolios.