Ripple Labs Acquires Standard Custody, Stepping Up Plans for Asset Tokenization and Stablecoin Launch
Summary:
Ripple Labs has completed its acquisition of Standard Custody, a digital asset custodian, marking a key step in its plans to launch a U.S. dollar stablecoin and tokenize real-world assets. Post-acquisition, Standard Custody CEO, Jack McDonald, will assume the role of Ripple's Senior Vice President of Stablecoins while retaining his original position. This acquisition follows Ripple's previous purchase of digital asset custody firm Metaco and signifies the company's belief in an emerging tokenization market, which could potentially be worth $800 trillion.
Ripple Labs finalized its purchase of Standard Custody, a custodian of digital assets, as announced on June 11. This acquisition, initially declared earlier this year, is crucial to Ripple's plan to release a U.S. dollar stablecoin and its larger ambition of tokenizing real-world assets. Jack McDonald, the CEO of Standard Custody, will serve as Ripple's Senior Vice President of Stablecoins, while retaining his CEO position at Standard Custody.
After the recent deal, McDonald took to social media to announce his newly acquired position at Ripple. Ripple has spotlighted Standard Custody's licensure as a unique characteristic of this digital asset custodian. They highlighted Standard Custody's approval from the strict New York Department of Financial Services (NYDFS) as a key to regulating digital assets.
Standard Custody's successful purchase by Ripple is succeeded by Ripple's 2023 acquisition of Metaco, a digital asset custody firm, for a whopping $250 million. Ripple's acquisition of Metaco was underpinned by the forecast that the institutional crypto custody sector could surge to $10 trillion by 2030, due to banks' growing interest in offering digital asset custodial services to clients.
Ripple Labs, among others, are setting their sights on tokenizing real-world assets, a sector that could explode to above $800 trillion if all capital assets worldwide are tokenized – this according to Chainlink. This burgeoning market of tokenization is widely held as the impending vast frontier for cryptocurrencies, blockchain, and digital assets.
In May, the Depository Trust and Clearing Corporation (DTCC) issued its report of a pilot program demonstrating real-world asset tokenization. The program involved several major banks, such as JP Morgan, Edward Jones, and BNY Mellon, and deployed Chainlink's CCIP interoperability protocol.
The goal of this enterprise was to examine the tokenization of fund-related data and to experiment with bringing real-world data onchain. According to DTCC's study, a number of advantages of blockchain tokenization were discovered, such as providing dynamic data management across an asset's life cycle, providing transparent APIs for customers, and lessening the burden of record-keeping through automated data management.
This pilot program ultimately shed light on the prospective applications for banks and other institutions, all looking to utilize blockchain tokenization in their offerings and services, such as automated data feeds and brokerage applications.
Published At
6/11/2024 8:26:43 PM
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