Standard Chartered now offers custody of Ripple USD (RLUSD), a stablecoin worth about $2.4 billion, to Dubai institutions, but its planned use as collateral at LMAX Group is not live.
Key Points:
- Standard Chartered's Dubai branch now holds RLUSD issued on the XRP Ledger for eligible institutional clients.
- A plan to let clients use RLUSD as LMAX trading collateral without moving the tokens still needs testing and approvals.
- The setup builds on the bank's earlier collateral mirroring pilot with OKX and Ripple's January deal with LMAX.
Standard Chartered Custody
The bank announced the service on Oct. 12, saying eligible clients can now keep RLUSD on its digital asset custody infrastructure.
Standard Chartered confirmed that the service runs through its Dubai International Financial Centre branch, which the Dubai Financial Services Authority regulates.
The custody covers RLUSD issued on the XRP Ledger, a public blockchain closely tied to Ripple and its XRP (XRP) token.
The second half of the deal is not live yet. Standard Chartered, Ripple and LMAX Group plan to make RLUSD eligible collateral for agreed LMAX trading and collateral management products. That step still depends on final documentation, successful testing, internal approvals and regulatory readiness, and the companies gave no launch date.
Under the bank's collateral mirroring model, RLUSD would stay in custody at Standard Chartered. LMAX would receive a record of the collateral's value and count it toward a client's trading positions without the tokens ever reaching the venue.
Also Read: XRP Ledger Hid A Coin-Minting Flaw Since 2015, Developers Now Reveal
RLUSD Collateral Mirroring
Trading firms usually post margin directly with an exchange, which pulls assets away from the custodian that protects them. The mirrored setup would keep RLUSD at a bank that global regulators class as systemically important. If an exchange failed, the client's tokens would still sit at Standard Chartered.
Waqar Chaudry, who heads digital assets in the bank's securities services business, said institutions want to trade crypto without weakening how their assets are protected or how risk is managed. Luke Dorney, LMAX Group's head of custody for digital assets, said adopting the bank's model gives clients more flexibility in how they hold and deploy RLUSD.
Jack McDonald, Ripple's senior vice president for stablecoins, said RLUSD "was built for exactly this kind of institutional use case."
Not everyone reads the news as a market catalyst. Bank custody does not create direct demand for RLUSD or XRP, one market analysis argued, describing the move as a signal about market structure instead. It added that other trading venues could face pressure to offer similar setups if the mirrored model works.
Others cautioned that the benefits hinge on how the bank and LMAX coordinate collateral records, verify balances and handle margin calls. That matters most in volatile markets, when positions suddenly need more collateral.
LMAX Partnership History
The RLUSD plan borrows from the bank's first collateral mirroring program, a Dubai pilot it launched with crypto exchange OKX on Apr. 10, 2025, in which it served as independent custodian.
The three companies have been moving closer all year. Ripple committed $150 million in financing to LMAX on Jan. 15, when LMAX agreed to adopt RLUSD as core collateral.
In July, the bank and LMAX ran what they called the industry's first live digital asset prime brokerage trades, and on Sept. 16 LMAX appointed Standard Chartered as its digital asset custodian in Luxembourg and Dubai.
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