Ripple Set to Unveil USD-Pegged Stablecoin on XRP Ledger and Ethereum
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Ripple, a major player in the blockchain and cryptocurrency sector, has unveiled plans to introduce a U.S. dollar-pegged stablecoin. This new digital currency will be integrated initially on two prominent blockchain platforms: the XRP Ledger and Ethereum.
Monica Long, Ripple’s President, expressed excitement about the project, stating, “Issuing our stablecoin on the XRP Ledger and Ethereum will be a crucial entry point to unlock new opportunities for institutional and DeFi use cases across various ecosystems.” She believes that introducing a reliable stablecoin to the XRP Ledger (XRPL) will significantly boost adoption and development, creating a vibrant and dynamic ecosystem.
Ripple’s upcoming stablecoin, scheduled for release later this year, promises a secure foundation backed by a combination of USD deposits, short-term U.S. government treasuries, and other cash equivalents. To ensure credibility and transparency, Ripple has committed to having these reserve assets audited by an independent third-party accounting firm, with plans to publish monthly attestations.
The stablecoin market, currently valued at over $150 billion, is dominated by Tether’s USDT and Circle Internet Financial’s USDC. Ripple’s entry into this market comes with a bold forecast, predicting the market’s expansion to an impressive $2.8 trillion by 2028.
1/ The stablecoin market is booming – around $150B today, and projected to soar past $2.8T by 2028. There's a clear demand for trust, stability, and utility.
That's why later this year we’re launching a stablecoin pegged 1:1 to the USD on the XRP Ledger and Ethereum.…
— Ripple (@Ripple) April 4, 2024
Ripple CTO Shares Thoughts on the Stablecoin Idea
David Schwartz, Ripple’s Chief Technology Officer, shared his retrospective thoughts on the timing of their stablecoin initiative with The Block. He acknowledged that an earlier launch could have been advantageous but emphasized that the current economic conditions, particularly the rise in interest rates, make this the right time to introduce their stablecoin.
Schwartz also addressed the competitive landscape, highlighting the regulatory challenges faced by Tether and the importance of having alternatives to USDC. “It’s essential not to rely on a single option,” he explained, advocating for diversity in the financial ecosystem.
With analysts from JPMorgan predicting a decline in USDT’s usage due to upcoming regulations and Tether’s CEO countering with claims of jealousy, Ripple aims to provide a fresh perspective. Schwartz envisions a market where multiple stablecoin options coexist, especially in the DeFi space, where reducing concentrated risk is crucial.
Ripple’s entry into the stablecoin arena seeks not only to challenge the status quo but also to enrich the cryptocurrency market with more choices, thereby enhancing stability and fostering innovation.
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