Ripple nears stablecoin launch after Standard Custody takeover

Ripple Labs has finalized its acquisition of digital asset custodian Standard Custody, which will be pivotal to its planned rollout of a USD-backed stablecoin and its broader ambitions in real-world asset tokenization.

As part of the acquisition, Standard Custody CEO Jack McDonald will take on the role of Ripple’s senior vice president of stablecoins while retaining his position as CEO of Standard Custody.

This move will see Ripple become the sole owner of Standard Custody. The acquisition is a strategic step for Ripple, allowing it to leverage Standard Custody’s New York trust and money transmitter licenses.

Ripple President Monica Long said the deal adds crucial licenses to Ripple’s portfolio, enabling them to offer comprehensive blockchain-based financial services. With existing licenses in the U.S. and Singapore, and efforts to secure more in the UK and Europe, Ripple is expanding its regulatory footprint.

Standard Custody is known for its institutional-grade digital asset custody, escrow, and settlement services. It was one of the early digital asset firms to secure a New York trust license in May 2021. As a PolySign subsidiary, it’s backed by decent funding that cements its position in the digital asset infrastructure market.

Ripple’s ambition goes beyond its current payment network, eyeing a broader role in the financial sector by enabling institutions to use blockchain for various services. Despite its legal battles with the SEC, Ripple was keen on expanding its services in the U.S., with the New York trust charter opening new avenues for offering in-house services.

The acquisition also comes as Ripple is set to expand its payments business in the United States, moving beyond its current focus where 90% of its business is outside the U.S. Oliver Segovia, Ripple’s senior director and head of product marketing, announced that after a relatively quiet period of three years in the U.S., Ripple Payments is ready to unveil new product updates. These updates are powered by the company’s money transmitter licenses (MTLs) that cover the majority of U.S. states.

The acquisition alsofollows Ripple’s 2023 purchase of Metaco, another digital asset custody firm, for $250 million. Ripple’s acquisition of Metaco was driven by the belief that the institutional crypto custody industry could reach $10 trillion by 2030 as banks increasingly provide digital asset custodial services to their customers.