Ripple CTO Confirms RLUSD Stablecoin Can Be Frozen to Meet Regulatory Mandates
Ripple’s Chief Technology Officer, David Schwartz, has confirmed that the company’s Ripple USD (RLUSD) stablecoin can be temporarily halted or reversed to meet legal or regulatory requirements. This confirmation comes in light of the amended GENIUS Act, which mandates stablecoin issuers to implement technology allowing them to freeze, seize, or stop transfers when legally required.

The GENIUS Act and Stablecoin Regulations
The Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, initially introduced on February 4, has been updated with key changes. Senator Bill Hagerty unveiled an amended version on March 10, which included the critical provision requiring issuers to have the ability to “seize, freeze, burn, or prevent the transfer of payment stablecoins.”
Attorney Jeremy Hogan, taking to the social media platform X (formerly Twitter), questioned the practical implications of the bill, specifically highlighting the technological capabilities issuers would need to implement the proposed rules. Hogan specifically asked if Ripple and Circle could actually freeze their stablecoins after they had been transferred.
In response, Schwartz confirmed that RLUSD possesses this critical functionality. “RLUSD can be frozen or clawed back,” stated Schwartz.
Clawback Functionality and Regulatory Compliance
Schwartz explained that this functionality is essential to ensure alignment between ledger balances and the issuer’s legal obligations. He further elaborated that because off-ledger events, such as court orders, can change or invalidate those obligations, having the ability to update the ledger is vital. Notably, the XRP Ledger (XRPL) community voted to activate the clawback amendment in January, with a 90% approval rate. This change allows token issuers to reclaim tokens from wallets that have been deposited into Automated Market Maker (AMM) pools, further ensuring compliance with regulatory requirements.
Because RLUSD is natively issued on both the XRP Ledger and Ethereum (ETH) blockchains, the clawback functionality applies to it as well. The bill also stipulates federal oversight for stablecoin issuers with market values exceeding $10 billion. Presently, only Tether (USDT) and USD Coin (USDC) satisfy this threshold. RLUSD is a relatively new stablecoin, launched by Ripple on December 17, 2024. With a current market capitalization of $135.1 million, according to BeInCrypto data, RLUSD remains subject to state regulation, though standards are expected to align with the federal framework.