Ripple's dollar-backed stablecoin scored a significant regulatory win in one of the world's most strictly governed crypto hubs after Abu Dhabi's financial regulator designated RLUSD as an accepted settlement asset for licensed institutions.
The Financial Services Regulatory Authority of Abu Dhabi Global Market on Thursday recognized RLUSD as an Accepted Fiat-Referenced Token, allowing authorized firms operating in the ADGM financial zone to deploy the stablecoin for regulated activities including collateral, lending, and prime brokerage services.
The approval places RLUSD alongside a small group of tokens permitted within ADGM's ring-fenced financial system.
For Ripple, the designation marks a material step into the Middle East institutional market, where banks and payment firms have shown greater willingness to adopt tokenized settlement infrastructure than their counterparts in the United States and Europe. The approval follows Ripple's March 2025 licensing by the Dubai Financial Services Authority and partnerships with UAE-based Zand Bank and fintech firm Mamo.
What Happened
The FSRA's recognition enables firms licensed by the authority to use RLUSD for regulated activities, provided they maintain compliance with firm-level regulatory obligations relevant to Fiat-Referenced Tokens. These requirements include full reserve backing, independent attestations, anti-money laundering compliance, client-asset segregation, and adherence to FSRA rules governing custody and issuance.
RLUSD, launched in late 2024 under a New York Department of Financial Services Limited Purpose Trust Company Charter, has reached a market capitalization exceeding $1.2 billion. The stablecoin ranks as the 10th-largest dollar-pegged token by market cap and has recorded 1,278% year-to-date growth.
Jack McDonald, Senior Vice President of Stablecoins at Ripple, said the FSRA recognition reinforces the company's commitment to regulatory compliance and trust. "With a market capitalization of over $1 billion and growing adoption in core financial uses like collateral and payments, RLUSD is quickly becoming a go-to USD stablecoin for major institutions," McDonald stated.
The stablecoin maintains a 103% reserve buffer through a 3% initial buffer and daily variation adjustments, with holdings in U.S. Treasury bills with maturities of three months or less, government money market funds, and deposits at FDIC-insured banks. Bank of New York Mellon holds non-cash reserve assets in custody, providing separation from proprietary assets.
RLUSD operates on both Ethereum and XRP Ledger networks, with approximately 80% of the total supply issued on Ethereum and 20% on XRP Ledger. The stablecoin processes $5.05 billion in monthly transfer volume with 38,166 holders and daily trading volume reaching $174 million.
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Why It Matters
The ADGM approval gives Ripple access to a jurisdiction that has built a reputation for strict token classifications and bank-friendly digital asset frameworks. Those safeguards have attracted several financial institutions in the Middle East and Africa to integrate Ripple's blockchain-enabled payment rails.
Ripple has rapidly expanded across the region throughout 2025. In May, the company signed Zand Bank and Mamo as the first customers to adopt Ripple Payments following its DFSA license, which allows it to manage global payments end-to-end for banks, fintechs, and crypto firms. In October, Ripple partnered with Bahrain Fintech Bay to support proof-of-concept projects and educational initiatives in the Kingdom.
The company also announced its first major custody partnership in Africa with Absa Bank in October, enabling the South African institution to leverage Ripple's custody technology for digital asset storage. According to Ripple's 2025 New Value Report, 64% of Middle East and Africa finance leaders cite faster payments and settlement times as the primary impetus for incorporating blockchain-based currencies into cross-border payment flows.
Reece Merrick, Managing Director for Middle East and Africa at Ripple, said ADGM's approval reinforces RLUSD as a compliant stablecoin meeting the highest standards of trust, transparency, and utility. "The UAE continues to set a global benchmark for digital asset regulation and innovation," Merrick stated.
Ripple Payments currently operates in over 90 payout markets and has processed more than $70 billion in volume globally. The platform uses a network of payout partners and blockchain infrastructure to move money in minutes, in some cases utilizing XRP as a bridge currency through its On-Demand Liquidity service.
Final Thoughts
ADGM's recognition of RLUSD comes as the FSRA finalizes its broader Fiat-Referenced Token framework, which sets out how dollar-backed stablecoins can be issued, held, and used in regulated contexts. RLUSD's greenlisting represents one of the first practical applications of that framework and could serve as a benchmark for future approvals.
The designation strengthens Abu Dhabi's positioning as a digital asset hub competing with Singapore, London, and New York. By establishing a clear category for Accepted Fiat-Referenced Tokens, the FSRA aims to attract issuers that meet high reserve, transparency, and governance standards.
With dual regulatory recognition in both the UAE and United States, RLUSD is positioned as an institutional-grade settlement asset for cross-border payments, tokenized securities, and on-chain collateralization across Gulf Cooperation Council markets. The approval provides Ripple with regulatory clarity to pitch RLUSD as a settlement asset that can integrate into payment corridors and capital-market applications without the regulatory uncertainty that has constrained competitors in other jurisdictions.
Arvind Ramamurthy, Chief Market Development Officer at ADGM, congratulated Ripple on the milestone and noted the authority looks forward to seeing the company leverage ADGM's regulatory framework designed to support sustainable growth of innovative firms while ensuring the highest international standards.
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