Institutional blockchain service provider and XRP developer Ripple announced a partnership with South African bank Absa on Wednesday to provide digital asset custody to the institution’s customers.
According to the announcement, Absa is “Ripple’s first major custody partner in Africa.” The bank will offer its customers digital asset custody services relying on Ripple’s infrastructure for tokenized assets and cryptocurrencies.
The bank is a major player on the African financial stage, managing 2.07 trillion South African rands ($119.5 billion) of assets as of the end of 2024. Absa also saw $6.34 billion of revenue last year.
Ripple said the partnership was “a result of the growing demand for secure, compliant digital asset infrastructure across emerging markets.” Reece Merrick, Ripple’s managing director for Middle East and Africa, said the partnership “underscores Ripple’s commitment to unlocking the potential of digital assets on the continent.”
The partnership expands Ripple’s presence in Africa. In late March, the company partnered with African payment infrastructure provider Chipper Cash to support crypto-enabled cross-border payments.
Last month, Ripple introduced its Ripple USD (RLUSD) stablecoin to Africa, leveraging partnerships with Chipper Cash, crypto exchange VALR, and crypto payment service Yellow Card. Ripple’s senior vice president of stablecoins, Jack McDonald, said that the company had begun RLUSD distribution in Africa through its local partners.
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Ripple bets on custody
Ripple first filed for a trademark dedicated to its custody service back in mid-March and has since started onboarding institutions as customers.
The service itself was launched about a year ago, explicitly aiming to serve on the back end of banks and financial technology firms. Ripple’s move followed the company’s acquisition of digital asset custodian Standard Custody last summer.
Earlier this month, Ripple partnered with Bahrain Fintech Bay to bring its custody solution alongside its RLUSD stablecoin to Bahrain’s financial institutions. In September, the company agreed to provide crypto custody services to Spanish bank Banco Bilbao Vizcaya Argentaria.
In early August, South Korean crypto custodian BDAas launched institutional custody support for XRP following its partnership with Ripple to leverage its custody services. Ripple’s custody efforts date back further than that, with the company having partnered with major bank HSBC in late 2023 to launch an institutional custody platform for tokenized securities.
Related: DBS, Franklin Templeton, Ripple team up to launch tokenized lending
Traditional finance wants in on crypto, too
Traditional finance and the crypto landscape are becoming increasingly connected. The crypto products offered by BlackRock, the world’s largest asset manager, helped power the asset manager to a strong quarter of earnings and revenue. Earlier this month, BlackRock’s spot Bitcoin (BTC) exchange-traded fund (ETF) was also reported to have generated nearly $245 million in fees over the past year.
Morgan Stanley, one of the world’s largest wealth managers, recently reportedly informed its financial advisers that all clients will be able to invest in cryptocurrency funds. BNY, the world’s largest custodian bank, is reportedly exploring tokenized deposits to enable clients to transfer funds instantly, 24/7.
Nation-states are also slowly jumping on the crypto bandwagon. Earlier this month, Luxembourg’s sovereign wealth fund allocated 1% of its portfolio to Bitcoin ETFs. This followed Norway’s sovereign wealth fund increasing its indirect Bitcoin exposure by 192% over the past year.
Those are not the only such cases. Czech National Bank boosted its holdings of US crypto exchange Coinbase this summer, while a member of the Swedish parliament proposed a “budget-neutral” Bitcoin reserve in April. Lastly, in February, the Czech National Bank started considering a Bitcoin test portfolio with an official suggesting that it should be studied rather than feared.
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