Ripple, BNY, Collaborate on Broadening Digital Custody

Ripple and BNY say they have extended their collaboration work on digital custody solution development and exploration of blockchain technology and are looking at trade finance among other areas.

Building on BNY’s role as primary reserve custodian for Ripple’s stablecoin, RLUSD, and its custody relationship with Ripple Prime, the bank now supports XRP, the native digital asset of the XRP Ledger, and RLUSD on its Digital Asset Custody platform. “We’re moving past the initial issuance of assets onchain – now, it’s all about making these tokenised assets usable for payments and collateral across financial markets,” says Monica Long, president of Ripple. “With BNY, we’re connecting the necessary components of financial infrastructure on the XRP Ledger so institutions can move from holding digital assets to using them within capital markets and trade finance seamlessly.”

Carolyn Weinberg, chief innovation and market transformation officer at BNY, adds, “Future market infrastructure will deliver connectivity across payments, liquidity, collateral and securities, driven by architected bridges between traditional scaled systems and always-on blockchain technology. In collaboration with Ripple, we are working to shape a more continuous, efficient and resilient financial system, paving the way for broader institutional adoption.” 

BNY also says it intends to broaden its support for tokenised assets and investment products issued on the XRPL as institutional use cases on the ledger continue to develop. It says it will work with Ripple to enable its clients to mint and redeem RLUSD directly through BNY, subject to regulatory approval. Both initiatives aim to support more efficient payments, settlement and collateral workflows over time, the bank states.

Ripple and BNY also intend to advance tokenised trade finance on the XRPL, subject to client requirements, the firms say, adding that tokenised trade finance can use blockchain technology to digitally represent existing trade finance assets, such as receivables. This provides, they add, the potential to broaden investor access and simplify how those assets are managed and distributed.

As a first step toward this ambition, Ripple and BNY are exploring a supply chain finance initiative with C2FO, a platform for working capital, focused on expanding investor access to the asset class. “We’ve spent years building a platform that gives businesses more information and control over their working capital. The next opportunity is to make the financial infrastructure behind our marketplace as efficient and connected as the experience we’ve created for customers,” says Ragui Selwanes, president and COO Americas at C2FO.