Moody’s has assigned Ripple’s RLUSD stablecoin an A2 long-term rating and a P-1 short-term rating, giving the dollar-backed token a credit assessment under the agency’s new stablecoin rating framework. RLUSD is issued by Ripple’s regulated subsidiary, Standard Custody & Trust Company, on the XRP Ledger and Ethereum.
According to Moody’s rating notice and comments from Ripple executive Jack McDonald on October 28, the assessment covers RLUSD’s financial obligations. McDonald described RLUSD as the first stablecoin to receive an investment-grade rating from Moody’s.
The announcement came during Ripple’s Swell conference week, as the company was also announcing new banking and custody partnerships.
A credit rating gives institutions another way to assess an issuer’s ability to meet its obligations. However, it does not guarantee that users can always redeem their tokens at one dollar, protect against every risk, or mean that all banks have approved RLUSD for use.
Moody’s assesses RLUSD’s reserves and redemption risks
Moody’s new stablecoin rating framework examines factors such as reserve quality, legal separation of assets, and liquidity. It applies traditional credit analysis to the structure of stablecoin obligations.
The A2 rating falls within Moody’s investment-grade category for long-term obligations, while P-1 is its highest short-term rating. A2 is not the agency’s highest long-term grade, which is Aaa.
RLUSD’s reserves reportedly consist mainly of cash and short-term US government securities, with BNY serving as the primary reserve custodian. Reports put reserve coverage at around 103% of outstanding tokens, meaning the reported reserve assets exceeded the value of the tokens in circulation at that time.
However, this does not eliminate every risk. The amount of money available for immediate withdrawals during a period of heavy redemption demand remains an important consideration.
Standard Custody operates under the supervision of the New York State Department of Financial Services. The rating does not make RLUSD an insured bank deposit.
RLUSD rating comes amid Ripple’s banking expansion
On October 27, Ripple and BNY expanded their institutional custody collaboration to include custody support for XRP and RLUSD, while also exploring tokenized trade finance.
BNY already serves as RLUSD’s primary reserve custodian. The expanded collaboration adds to that existing relationship by exploring further services for institutional customers.
BNY put RLUSD’s market capitalization at around $2.5 billion, reflecting the value of tokens in circulation at the time of its announcement. This figure does not represent the amount held or transferred by institutional customers.
Other banking partnerships have also developed. On October 12, Standard Chartered introduced institutional RLUSD custody through its Dubai International Financial Centre branch. A proposed collateral arrangement with LMAX Group, meanwhile, remains subject to further approvals and testing.
Ripple has also reached an agreement with Cross River Bank to integrate RLUSD into its payment infrastructure for dollar transfers and around-the-clock settlement. However, the agreement does not mean that every Cross River customer can already make stablecoin payments.
Stablecoin ratings differ between agencies
Moody’s assessment is different from the stability scores issued by S&P Global Ratings, which evaluates how reliably stablecoins can maintain their reference value.
S&P gave Circle’s USDC a score of 2, indicating strong stability, in December 2025. It assigned Tether’s USDT a score of 5, indicating weak stability, in November 2025, citing concerns about reserve composition and transparency.
These scores use a different system from Moody’s deposit ratings, so they cannot be directly compared with RLUSD’s A2 and P-1 grades.
There has been no public announcement establishing that Circle or Tether has applied for a rating under Moody’s new framework. Any such assessment would depend on a decision by the issuer and the rating agency.
Institutional adoption still depends on operational requirements
McDonald said Moody’s assessment examined reserve quality, redemption arrangements, custody relationships, regulatory oversight, and operational controls. However, the publicly accessible announcement does not provide the full analytical explanation behind the rating.
Institutions must also complete their own onboarding processes and determine whether RLUSD meets their requirements. Holding a stablecoin through a custody service is different from accepting it as collateral for loans or margin trading, which may require separate approvals.
Standard Chartered’s custody service provides one example of bank support for RLUSD, while its planned collateral services show that custody and lending eligibility are separate matters.
Ripple has not disclosed any new RLUSD transaction volumes, banking mandates, or redemption activity specifically resulting from the Moody’s rating. The publicly available rating materials also do not specify the next review date or the conditions that could lead to a change in the assessment.