Ripple's RLUSD stablecoin gets regulatory green light in Abu Dhabi for institutional use

Source: Yellow Original Title: Ripple's RLUSD stablecoin gets regulatory green light in Abu Dhabi for institutional use

Original Link: Ripple's dollar-backed stablecoin achieved a significant regulatory victory in one of the world's most strictly regulated crypto hubs after the Abu Dhabi financial regulator designated RLUSD as an accepted settlement asset for licensed institutions.

The Financial Services Regulatory Authority of Abu Dhabi Global Market recognized RLUSD as an Accepted Fiat-Referenced Token, allowing authorized firms operating in the ADGM financial zone to use the stablecoin for regulated activities, including collateral, loans, and prime brokerage services.

The approval places RLUSD alongside a small group of permitted tokens within the ADGM financial system, which is highly restricted.

For Ripple, the designation represents an important step in the Middle Eastern institutional market, where banks and payment companies have shown greater willingness to adopt tokenized settlement infrastructures than their counterparts in the United States and Europe. The approval follows the license granted to Ripple in March 2025 by the Financial Services Authority of Dubai and its partnerships with the UAE-based Zand Bank and the fintech firm Mamo.

What happened

The recognition by the FSRA allows firms licensed by the authority to use RLUSD for regulated activities, provided they maintain compliance with the relevant firm-level regulatory obligations for Fiat-Referenced Tokens. These requirements include 100% reserve backing, independent attestations, compliance with anti-money laundering regulations, segregation of client assets, and adherence to the FSRA rules governing custody and issuance.

RLUSD, launched in late 2024 under a Limited Purpose Trust Company Charter from the New York Department of Financial Services, has achieved a market capitalization exceeding $1.2 billion. The stablecoin ranks as the 10th dollar-linked token by market cap and has recorded a growth of 1,278% year-to-date.

Jack McDonald, senior vice president of stablecoins at Ripple, stated that the FSRA's recognition reinforces the company's commitment to regulatory compliance and trust. “With a market capitalization of over $1 billion and increasing adoption in key financial uses such as collateral and payments, RLUSD is quickly becoming a benchmark USD stablecoin for large institutions,” McDonald noted.

The stablecoin maintains a reserve cushion of 103% through an initial buffer of 3% and daily variation adjustments, holding Treasury bills of the U.S. with maturities of three months or less, government money market funds, and deposits in FDIC-insured banks. Bank of New York Mellon holds the illiquid reserve assets in custody, providing separation from its own assets.

RLUSD operates on both the Ethereum network and XRP Ledger, with approximately 80% of the total supply issued on Ethereum and 20% on XRP Ledger. The stablecoin processes $5.050 billion in monthly transfer volume, with 38,166 holders and a daily trading volume reaching $174 million.

Why it is important

ADGM's approval gives Ripple access to a jurisdiction that has earned a reputation for its strict token classifications and banking-friendly digital asset frameworks. These safeguards have attracted several financial institutions from 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 with Zand Bank and Mamo as the first clients to adopt Ripple Payments after obtaining its license from the DFSA, which allows it to manage end-to-end global payments 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 in October its first major custody alliance in Africa with Absa Bank, allowing the South African institution to leverage Ripple's custody technology for the storage of digital assets. According to Ripple's New Value 2025 report, 64% of financial leaders in the Middle East and Africa cite faster payments and settlement times as the main driver for incorporating blockchain-based currencies into cross-border payment flows.

Reece Merrick, General Director for the Middle East and Africa at Ripple, stated that the approval from ADGM reinforces RLUSD as a compliant stablecoin that meets the highest standards of trust, transparency, and utility. “The UAE continues to set a global benchmark in the regulation and innovation of digital assets,” Merrick noted.

Ripple Payments currently operates in more than 90 payment markets and has processed over $70 billion in volume globally. The platform uses a network of payment partners and blockchain infrastructure to move money in minutes, in some cases using XRP as a bridge currency through its On-Demand Liquidity service.

Final Reflections

The recognition of RLUSD by ADGM comes as the FSRA finalizes its broader framework for Fiat-Referenced Tokens, which defines how dollar-backed stablecoins can be issued, maintained, and used in regulated contexts. The inclusion of RLUSD in the green list represents one of the first practical applications of that framework and could serve as a reference for future approvals.

The designation reinforces Abu Dhabi's position 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 standards of reserves, transparency, and governance.

With dual regulatory recognition in both the UAE and the United States, RLUSD positions itself as an institutional-grade settlement asset for cross-border payments, tokenized securities, and on-chain collateralization in the Gulf Cooperation Council markets. The approval provides Ripple with regulatory clarity to present RLUSD as a settlement asset that can be integrated into payment corridors and capital markets applications without the regulatory uncertainty that has limited competitors in other jurisdictions.

Arvind Ramamurthy, Chief Market Development Officer at ADGM, congratulated Ripple on this milestone and noted that the authority looks forward to seeing how the company leverages the ADGM regulatory framework, designed to support the sustainable growth of innovative firms while ensuring the highest international standards.