Coinspeaker
Ripple Announces Plan to Launch a Multichain USD-backed Stablecoin
Ripple Labs, a veteran blockchain-based cross-border payment company, has announced that it will be launching a US dollar-backed stablecoin to further bridge the gap between traditional finance and the cryptocurrency industry. According to the announcement, Ripple will be launching a stablecoin on Ethereum (ETH) under the ERC-20 token standard and on the XRPL network.
However, Ripple intends to expand its stablecoin to other blockchains and decentralized financial (DeFi) platforms in a bid to enhance its availability to global markets. Ripple projects that the stablecoins industry will grow from the current $150 billion valuation to around $3 trillion by 2028.
According to Ripple’s CEO Brad Garlinghouse, the launch of the stablecoin is a natural cause for the company’s development as a major cross-border firm. As Coinspeaker previously reported, Ripple has acquired several web3-oriented companies – including Standard Custody and Metaco – to help improve XRP’s liquidity.
“Institutions entering this space are finding success by partnering with compliant, crypto-native players and Ripple’s track record and resiliency speaks for itself, as we launch new products and acquire companies through multiple market cycles. This move is also monumental for the XRP Ledger community, driving more use cases, liquidity, and opportunities for developers and users,” Garlinghouse stated.
Ripple’s Plan to Compete with USDT and USDC
The stablecoins industry is heavily dominated by Tether’s USDT and Circle’s USDC following the collapse of the algorithmic-based Terra Luna UST, which triggered the 2022 cryptocurrency bear market. However, Ripple is confident that it will challenge the existing stablecoins with its latest product due to several reasons including the reputation obtained over the past years.
Moreover, Ripple has significantly improved in its regulatory capacity over the years following the ongoing lawsuit filed by the US SEC. “The XRP Ledger’s native capabilities, including a decentralized exchange and automated market maker, were built to utilize XRP as the bridge asset. Bringing a trusted stablecoin onto XRPL will drive more adoption and development, contributing to a vibrant ecosystem,” Monica Long, Ripple President, highlighted.
According to Ripple’s CTO, David Schwartz, the upcoming stablecoin on the XRPL network is high-quality, which will be a huge game-changer for the decentralized financial (DeFi) users and web3 developers at large. As Coinspeaker previously pointed out, Ripple intends to leverage the recently launched Automated Market Maker (AMM) to attract more users on the XRPL network.
A high-quality USD stablecoin on the XRPL – with its decentralized exchange and features like issued currencies, auto-bridging (that uses XRP as the native currency to facilitate trades between other assets), and the AMM — will be a gamechanger for users and devs. https://t.co/uGC72bosfM
— David "JoelKatz" Schwartz (@JoelKatz) April 4, 2024
Direct Impact on XRP Price
Following the announcement, XRP’s daily average trading volume spiked by more than 30 percent to about $2.1 billion, amid heightened speculation. As of this report, XRP price trades around 59 cents, up more than 2 percent in the last 24 hours.
The large-cap altcoin, with a fully diluted valuation of nearly $60 billion, is preparing to rally towards its all-time high after consolidating in a macro triangular pattern in the past six years. However, it is prudent to keep note of the upcoming civil trial of the SEC vs Ripple lawsuit as it will have a profound impact on XRP price action.
Ripple Announces Plan to Launch a Multichain USD-backed Stablecoin
