Is RLUSD Actually Regulated? What Ripple’s Trust Charter Means Versus Tether and USDC
Three stablecoins carry the same dollar promise but answer to three very different legal structures, and the gap between them determines what holders actually own if an issuer collapses.
This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.
RLUSD (CRYPTO:RLUSD), USD Coin (CRYPTO:USDC), and Tether (CRYPTO:USDT) all put the word dollar on the label, and all three answer to different regulators, or to none.
Ripple argues that the gap between them decides what happens to holders if an issuer fails, and Ripple issues RLUSD, so Ripple has an interest in the answer. So does the charter change what a holder owns?
A Dollar Stablecoin Can Be Regulated Three Ways
A money transmitter license is a state-issued permit to move customer funds, with reserve rules that vary by state and no federal prudential supervisor watching the issuer. Non-bank crypto firms in the US commonly operate under a collection of these licenses, state by state. Reserves back the coin under rules that differ between states, and holders would rank behind other creditors if the issuer collapsed.
New York’s Department of Financial Services grants limited-purpose trust charters requiring segregated reserves, a fiduciary duty to holders, and regular attestations. An attestation is a public report by an outside CPA firm confirming reserves match liabilities at a point in time, which differs from a full audit because it doesn’t test the issuer’s controls. If the issuer fails, the segregated reserves are legally separate from the estate, so holders rank ahead of ordinary creditors.
The Office of the Comptroller of the Currency grants the national trust charter that carries federal prudential supervision, which brings a bank-style supervisor in, with capital rules, exam authority, and resolution mechanics that separate customer money from the failing entity. A national trust bank cannot take deposits, offer checking accounts, or access FDIC insurance, so the charter is about supervision rather than banking powers.
Where RLUSD, USDC and Tether Each Stand
RLUSD holds a NYDFS limited-purpose trust charter with segregated reserves and monthly independent CPA attestation, which Ripple pairs with BNY Mellon as reserve custodian. Ripple also received a conditionally approved OCC national trust charter in December 2025, which would move RLUSD into the federal tier once the conditions are met.
Circle, the issuer of USDC, received full OCC approval on July 10, 2026, and unlike Ripple’s, it isn’t conditional. Circle then picked up a NYDFS trust charter three weeks later, so USDC now holds both the state and federal tiers rather than one. No other dollar stablecoin holds both charters.
Tether has no US charter. The largest stablecoin by supply operates from El Salvador and doesn’t submit to a US prudential supervisor, so no US regulator has resolution authority over the issuer. Tether publishes quarterly attestations of its reserves, which report the reserves without testing the controls behind them. If Tether failed, a holder’s claim would run through offshore courts and offshore insolvency law rather than a US receiver overseeing an orderly wind-down.
RLUSD’s Regulatory Edge Has About a Year Left
A charter counts for more when a coin carries size, and RLUSD holds $810 million on the XRP Ledger against $756 million on Ethereum. The XRP Ledger holds the larger share, which is the network Ripple built and where its payment customers already settle, while the Ethereum share puts RLUSD alongside the incumbents on the chain that carries most stablecoin activity.
A 21-bank consortium stablecoin is planned for the first half of 2027. A bank consortium coin would launch with prudential supervision already attached, which puts another fully supervised option in front of institutions while RLUSD is still second behind USDC. That gives Ripple a little over a year to convert the conditional charter before the field gets more crowded.
RLUSD’s Federal Charter Is Still Conditional
RLUSD is regulated at the state trust tier through the NYDFS charter, and conditionally approved for the federal tier through the OCC, so the coin carries stronger legal backing than Tether and weaker than USDC. Federal supervision doesn’t apply until the OCC lifts the conditions attached to that approval.
The OCC would need to convert the conditional national trust charter into an unconditional one, which typically requires the applicant to satisfy capital, governance, and operational commitments set out in the approval letter. Until Ripple clears those conditions, RLUSD is a state-regulated stablecoin with a federal charter in progress.
Contact [email protected] for any questions or corrections.
Sam Daodu is a crypto analyst who's spent nearly a decade making blockchain understandable—no easy task when most whitepapers read like fever dreams. He writes for 24/7 Wall St., covering Bitcoin, altcoins, and crypto market analysis for investors. Before crypto, he was a tech writer (back when explaining "the cloud" was peak innovation). Since 2018, he's written for CoinTelegraph, Yahoo Finance, The Block, Cryptonews, Zypto, Rain, and more—basically anywhere people want crypto news without the headache. Sam runs MacLabs Marketing, a content agency for crypto brands tired of sounding like AI wrote their website. He also publishes free crypto education on his site for Web3 enthusiasts who think "gas fees" is a typo. When he's not writing or staring at charts, Sam's either: - Watching anime (currently convinced One Piece has better tokenomics than most altcoins) - At the gym sculpting himself into a Greek god - Listening to the music your mum warned you only bad boys listen to Connect: LinkedIn | Email | MacLabs Marketing
