Moody’s assigns A2 and P-1 ratings to Ripple’s RLUSD stablecoin

Moody’s Ratings assigned Ripple USD an A2 long-term deposit rating and a P-1 short-term rating on October 28, bringing a conventional credit-risk scale to a dollar stablecoin issued by Ripple subsidiary Standard Custody & Trust Company.

The Block, citing Moody’s rating notice, reported that the agency considered the quality and market value of RLUSD’s reserve assets, reserve coverage, liquidity, redemption arrangements, asset segregation and third-party custody. Both ratings fall within Moody’s investment-grade categories, while P-1 is its highest short-term designation.

The action matters because stablecoins promise dollar redemption but expose holders to risks that differ from those of insured bank deposits. A formal rating gives institutional risk teams an additional framework for evaluating those risks. It does not certify that RLUSD will always trade at one dollar, guarantee immediate redemption or eliminate operational, legal and issuer risk.

What Moody’s evaluated

RLUSD is issued by Standard Custody, a limited-purpose trust company supervised by the New York Department of Financial Services. Ripple says the reserve is held in segregated accounts and consists of dollar deposits, short-term U.S. government securities and other cash equivalents.

According to The Block’s account of the Moody’s notice, the reserve is predominantly invested in liquid, short-duration U.S. government assets and cash. BNY serves as the primary reserve custodian. The report said Standard Custody targets reserve coverage of 103%, meaning reserve assets are intended to exceed outstanding tokens rather than merely match them.

That 103% figure is an operating target, not a measurement proving that coverage remains at exactly that level every day. Moody’s also identified conditions that could pressure the ratings, including deterioration in reserve credit quality or market value, reduced coverage, weaker liquidity or diminished redemption capacity.

Ripple’s dashboard showed a larger point-in-time cushion

Ripple’s transparency dashboard reported $2.3828 billion of RLUSD in circulation and $2.5280 billion in reserve funds as of October 22. The difference was $145.2 million, and Coinburn calculates that the displayed reserve equaled approximately 106.1% of the displayed circulating amount.

That calculation is a point-in-time comparison of two company-published dashboard balances. It is not the 103% policy target cited in the rating report, an audited daily average or proof that every token holder could redeem simultaneously without delay. The dashboard says independent accountants publish monthly attestations covering management’s assertions about circulation and reserve composition; its most recent selectable report was for August, so the October 22 balances are newer than the latest monthly attestation displayed.

Ripple’s user terms add another limitation. Direct redemption is available to eligible customers under separate customer agreements, while users who obtain RLUSD through unaffiliated platforms may not have the same direct relationship. The terms also state that Ripple does not guarantee a constant one-dollar price on third-party markets, even though eligible customers can redeem at par subject to applicable fees and conditions.

The rating is an opinion, not insurance

An A2 rating indicates Moody’s view of relatively low long-term credit risk; P-1 addresses short-term repayment capacity. Neither mark makes RLUSD a bank deposit, provides deposit insurance or removes blockchain and platform risks. The ratings can also change if Moody’s assessment or the underlying reserve structure changes.

Ripple called RLUSD the first stablecoin to receive an investment-grade Moody’s rating. Coinburn could not independently verify that comparative claim from Moody’s complete ratings universe, so it is not treated here as an established first.

The rating action occurred October 28, while the reserve dashboard’s measurement date was October 22. The next useful checks are Moody’s full published rationale, Ripple’s September and October attestations, changes in reserve coverage and any subsequent rating review. Those records will show whether the point-in-time cushion and stated redemption arrangements persist after the initial assessment.