XRP custody is rapidly becoming a critical pillar in the global shift toward digital finance, underpinning everything from tokenized real-world assets to enterprise-level stablecoin use. Ripple’s policy leaders are now spotlighting what they consider the four foundational best practices needed for institutions to adopt secure and scalable custody solutions.

The Strategic Importance of Custody in Digital Finance

According to Ripple’s global co-head of policy Rahul Advani and Asia-Pacific policy manager Caren Tso, digital asset custody is no longer optional for institutions—it’s a strategic gateway to participate in the expanding world of tokenized finance. In a recent blog post, the executives emphasized that custody is pivotal for businesses aiming to integrate with stablecoins, tokenization efforts, and cross-border payment frameworks.

Referencing a Ripple and Boston Consulting Group report, they noted the tokenization of real-world assets could reach $18.9 trillion by 2033. Additionally, Ripple’s regional survey revealed that over half of Asia-Pacific enterprises intend to implement custody solutions within three years—a clear sign of growing adoption across markets.

Insights from Ripple’s Custody and Cybersecurity Workshop

The blog coincided with the “Custody & Cybersecurity: Institutional Best Practices for Stablecoins and Beyond” workshop, which Ripple co-organized with the Blockchain Association Singapore (BAS). This event brought together industry experts to define standards in digital asset protection and culminated in a formal best practices report produced by BAS subcommittees focused on cybersecurity and stablecoins.

The Four Core Principles for Digital Asset Custody

Advani and Tso detailed four guiding principles that should underpin institutional custody frameworks:

• Compliance by Design: Custody systems must be engineered for compliance from the ground up. Regulatory frameworks like Singapore’s MAS mandate asset segregation and stringent recovery protocols to protect clients and systemic stability.
• Flexible Custody Models: Institutions should adopt custody models based on operational needs, such as third-party, hybrid, or self-custody options. Increasingly, firms are looking for wallet structures that go beyond the traditional “hot” or “cold” classifications.
• Operational Resilience: To ensure reliability, custody operations must meet standards from regulatory acts like the EU’s Digital Operational Resilience Act. Systems should integrate robust monitoring and include tested incident-response protocols.
• Strong Governance: Transparent governance frameworks—featuring independent oversight, clear audit trails, and role segregation—are essential for maintaining institutional trust.

Custody’s Expanding Role in Financial Services

Beyond these principles, Ripple emphasized custody’s growing influence on stablecoin integration into mainstream finance. Whether supporting trade finance, cross-border payments, or liquidity optimization, custody is fundamental to enabling these functionalities. Institutions increasingly require solutions offering API access, AML tools, and programmatic features that are capable of handling tokenized trade documents and compliance mechanisms.

Chart from Ripple’s study illustrating tokenized real-world assets reaching $18.9 trillion by 2033.

Ripple’s Offering and Institutional Integration

The blog further outlined how Ripple is addressing these institutional needs with its own solutions. Its Ripple USD (RLUSD) stablecoin is issued under a New York Trust Company Charter, ensuring full reserve backing, regular independent audits, and clear segregation of client assets. The company’s custody platform is designed to help firms manage tokenized assets while staying aligned with regulatory and operational benchmarks.

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Looking forward, Advani and Tso anticipate that digital custody tools will evolve to support smart contract interactions and tokenized documentation at scale. This integration will be vital for building a future-proof digital financial system—one that is scalable, secure, and ready for the demands of next-generation finance.