Moody’s assigned investment-grade credit ratings to Ripple’s dollar-backed stablecoin RLUSD, evaluating the quality of its reserves and users’ ability to redeem their tokens for cash.
According to The Block, RLUSD received A2 long-term and P-1 short-term deposit ratings. Jack McDonald, Ripple’s senior vice president in charge of stablecoins, said RLUSD was the first stablecoin to receive investment-grade ratings from Moody’s and described the decision as an important endorsement for the project.
Targeting $103 in Reserves for Every $100 in Tokens
Moody’s assessment highlighted that most of the reserves consist of U.S. Treasury bills, other short-term U.S. government assets, and cash. These assets are held at BNY Mellon, which the agency rated Aa1.
Standard Custody & Trust Company targets a 103% reserve ratio against outstanding token liabilities. In other words, the goal is to hold $103 in reserves for every $100 in liabilities. Moody’s said this target is above the minimum level required for the assigned rating.
In addition to the credit quality and market value of the assets, the rating assessment also examined the segregation of reserves, their custody by third parties, and redemption arrangements. Operational and technological risks, as well as the legal and regulatory framework, were also included in the assessment.
Maintaining the Rating Depends on Reserve Strength
The ratings, assigned under the stablecoin methodology published in March 2026, may change depending on the state of the reserves. A deterioration in the credit quality or market value of the assets, a decline in the reserve ratio, or weakening liquidity and redemption capacity could lead to a downgrade.
Moody’s also noted that the GENIUS Act, which it said would take effect in January 2027, would strengthen protections for stablecoin holders by keeping required reserves separate from the issuer’s bankruptcy estate.
Launched in December 2024, RLUSD has reached a market value of $2.5 billion. Ripple says the token is used primarily in payment infrastructure and as collateral at Ripple Prime. The approval Ripple received this week to establish a national trust bank in the U.S. also includes authority covering the management of RLUSD reserves.
Not investment advice.