Ripple Exec Warns Banks: No Stablecoin Strategy Means Falling Behind
Ripple’s head for the Middle East and Africa, Reece Merrick, has delivered a clear warning to traditional financial institutions: in an era where digital money is rapidly going mainstream, banks that still lack a stablecoin strategy are already losing ground.
According to Merrick, the global financial industry has reached a point where ignoring stablecoins is no longer an option.
“I don’t think there’s a bank, financial institution or payments company today that isn’t at least discussing or evaluating a stablecoin strategy,” he said in an interview in Abu Dhabi. “And quite frankly, if they’re not, they will get left behind.”
Ripple Secures Key Regulatory Win For RLUSD
Merrick’s comments followed an important regulatory milestone for Ripple. The company’s dollar-pegged stablecoin, RLUSD, has been officially classified as an “Accepted Fiat-Referenced Token” by the Financial Services Regulatory Authority (FSRA) of Abu Dhabi.
This designation means that institutions licensed in the Abu Dhabi Global Market (ADGM) can now use RLUSD in regulated financial activities. In practice, that puts Ripple’s stablecoin inside one of the most forward-looking regulatory environments for digital assets in the Gulf region.
For Ripple, the move is about far more than branding. It gives RLUSD a regulatory home base in a jurisdiction that is actively courting digital finance, and it positions the stablecoin as infrastructure for institutional finance rather than a speculative crypto product.
“First and foremost, this further validates Ripple’s value proposition in the region and reinforces our compliance-first approach to launching RLUSD at the end of last year,” Merrick explained. With the FSRA’s green light, ADGM firms can now “utilize RLUSD within their flows, within their operations,” a step he called “a great step forward for Ripple and a great step forward for the region.”
A Compliance-First Stablecoin Strategy
Ripple has been deliberately building RLUSD as an institutional-grade asset rather than a retail-focused token. That starts with supervision by what Merrick described as “the gold standard of regulators” – the New York Department of Financial Services (NYDFS), which oversees the issuance of RLUSD in the United States.
Layered on top of that are approvals and recognitions in other leading jurisdictions: Abu Dhabi’s FSRA and Dubai’s DFSA, which previously authorized Ripple as the first blockchain-enabled payment solution provider under its regime. By stacking regulatory endorsements across major financial hubs, Ripple is attempting to send a single, straightforward message: RLUSD is designed for serious, regulated use.
Merrick repeatedly emphasized that trust and compliance are not marketing buzzwords but the foundation for any stablecoin that aims to be used by banks and corporates. In a landscape still haunted by past failures and controversies in the crypto sector, Ripple is positioning RLUSD as the opposite of a lightly regulated dollar token.
Ripple’s Stablecoin vs. The Giants
Despite the strong regulatory footing, RLUSD remains a relatively small player in the broader stablecoin ecosystem. Its circulation currently stands at around 1.2 billion dollars – tiny compared with Tether’s USDT, which sits near 120 billion.
Merrick did not try to dress up that contrast. Instead, he focused on the size of the overall opportunity. The stablecoin market today is roughly 300 billion dollars, he noted, largely dominated by USDT and USDC. But Ripple expects that figure to grow significantly, forecasting that stablecoins could ultimately represent “trillions” of dollars in value, with enough room for multiple large issuers.
In that future, the contest is less about being the biggest token today and more about who builds the rails and relationships that institutions actually use. That is where Ripple believes it can carve out a meaningful share.
How Ripple Plans To Make RLUSD The Institutional “Gold Standard”
Ripple’s strategy is to embed RLUSD directly into existing financial infrastructure and high-volume payment corridors rather than relying solely on crypto-native adoption. Merrick said the company wants RLUSD “to be the gold standard for institutions looking to adopt a stablecoin,” and he backed that up with concrete examples from Ripple’s recent expansion.
One pillar is G-Treasury, a corporate treasury management platform that has visibility into how Fortune 500 companies move trillions of dollars across their internal operations. By integrating RLUSD into such systems, Ripple aims to make stablecoin-based liquidity and settlement a natural part of how multinational corporations manage cash and working capital.
Another pillar is Hidden Road, now operating under the brand Ripple Prime, a prime brokerage platform that Merrick said “turns over three trillion in prime brokerage.” If RLUSD becomes the default settlement asset for these flows, it effectively plugs the stablecoin into the deep end of institutional capital markets.
According to Merrick, since announcing the partnership with G-Treasury, Ripple has seen “so much inbound” from institutions considering RLUSD for their internal operations, including use cases like intercompany payments, liquidity management between subsidiaries and near-instant settlement across borders.
Building On Ripple’s Cross-Border Payments Track Record
Underneath the stablecoin push sits Ripple’s long-standing cross-border payments business, which has already processed around 95 billion dollars in volume using XRP and the XRP Ledger. That infrastructure, existing client base and global reach are now being leveraged to introduce RLUSD as an additional settlement option.
Merrick described RLUSD as a “natural step” driven by customer demand. Many of Ripple’s clients had been asking for stablecoin-based payout options, particularly in regions where dollar exposure is crucial but direct access to the US banking system is limited or slow.
With roughly half of global cross-border payments denominated in US dollars – and a significant portion of those not actually ending up in the US – current correspondent banking channels often remain slow, opaque and expensive. Regulated, blockchain-based dollar tokens like RLUSD offer the potential for near-instant, 24/7 settlement with full auditability.
From Ripple’s perspective, this is where the convergence of traditional finance and digital assets becomes tangible: replacing clunky legacy infrastructure with programmable money that behaves like cash but moves at the speed of the internet.
Why Banks Can’t Afford To Ignore Stablecoins
The pressure on banks is twofold. On the one hand, stablecoins are already being used as global settlement tools by exchanges, fintechs and trading firms. On the other, regulators in several jurisdictions are moving toward formal frameworks that will allow licensed institutions to issue, custody and use fiat-referenced tokens.
For banks, that means stablecoins are shifting from being a fringe crypto concept to a regulated financial instrument – and potentially a direct competitor to parts of their payments business. If they stay on the sidelines, fintech companies, payment processors and blockchain-native firms may capture a growing share of cross-border flows and transaction fees.
Merrick’s warning reflects this reality. A “stablecoin strategy” does not necessarily mean launching a proprietary token immediately, but it does mean understanding where and how stablecoins will touch core banking functions: payments, trade finance, treasury, lending, cash management and even deposit-taking.
In practical terms, banks that fail to integrate or interact with regulated stablecoins risk offering slower, more expensive services while their clients increasingly expect on-demand, real-time settlement – especially in emerging markets and high-volume trade corridors.
Trust, Transparency And Boardroom Skepticism
Despite the momentum, skepticism remains widespread in boardrooms. As CNBC’s Dan Murphy pointed out, even at high-profile finance events in Abu Dhabi, many senior executives still express confusion about digital assets, question their durability and worry about regulatory and reputational risk.
Merrick acknowledged that hesitation but argued that the only way to shift perceptions is through a sustained focus on three pillars: regulation, transparency and real-world utility.
“Trust is paramount,” he said, pointing again to approvals from NYDFS, ADGM and DFSA as proof that RLUSD is being built under some of the strictest oversight in the world. That includes requirements around reserve quality, risk management, reporting and consumer protections.
Transparency over collateral is another critical factor. For institutional users, knowing exactly how a stablecoin is backed, how reserves are held and how redemption works is non-negotiable. Without that level of clarity, most banks’ risk committees will simply not sign off.
Finally, Merrick stressed that the narrative changes only when stablecoins demonstrate clear, repeatable value in real business processes: faster settlement times, lower FX and transaction costs, improved liquidity management and better visibility over cash positions.
The Competitive Landscape For Institutional Stablecoins
Ripple is not alone in chasing institutional clients. Banks, payment giants and other crypto firms are all exploring regulated stablecoin products, blockchain-based bank money or tokenized deposits.
The competition is likely to intensify as more jurisdictions publish formal rules for fiat-referenced tokens and as central banks experiment with wholesale and retail central bank digital currencies (CBDCs). In this environment, issuers that can show both strong compliance and strong integration with existing financial workflows will have an edge.
Ripple’s bet is that its combination of regulatory approvals, established payments network, and deep partnerships with corporate treasury platforms and prime brokers will differentiate RLUSD from more retail-oriented tokens. Whether that is enough to secure a leading share remains to be seen, but the company clearly sees institutional stablecoins as one of its core strategic pillars for the coming years.
What A Robust Stablecoin Strategy Looks Like For Banks
For financial institutions watching these developments, a credible stablecoin strategy typically involves several components:
– Regulatory mapping: understanding how local and international regulations treat fiat-referenced tokens, and what licenses or approvals are required to issue, custody or use them.
– Infrastructure readiness: assessing whether existing core banking, treasury and compliance systems can handle on-chain settlement, or whether new middleware and integrations are needed.
– Risk and governance frameworks: defining policies for counterparty risk, collateral quality, redemption mechanisms, AML/KYC controls and cyber security.
– Use-case prioritization: identifying high-impact areas such as cross-border payments, corporate treasury operations, trade settlement or interbank transfers where stablecoins can deliver clear benefits.
– Partnerships and pilots: working with regulated issuers and technology providers to run controlled pilots before scaling production use.
Institutions that start this process now will be better positioned to adapt as the regulatory environment matures and client demand accelerates.
Looking Ahead: From Experiment To Infrastructure
The direction of travel is becoming clearer. Stablecoins are evolving from speculative trading tools into key components of financial infrastructure. As they inch closer to mainstream adoption, the line between “crypto” and “finance” is blurring.
Ripple’s RLUSD is one of several attempts to build a compliant, institution-ready dollar token designed to move value globally with the reliability expected from traditional finance. Its regulatory endorsements and integration strategy reflect the broader shift: digital assets are being reshaped to fit inside existing legal and supervisory frameworks, not outside them.
For banks and other financial institutions, the choice is narrowing. Either they begin to actively shape and participate in this new infrastructure, or they watch others seize the opportunity. In Merrick’s view, those that choose the second path are already behind the curve – and risk falling further back as stablecoin-based finance moves from niche to normal.