Ripple, a blockchain-powered payment services provider, officially launched its US dollar-pegged stablecoin, Ripple USD (RLUSD), on December 17, 2024. The launch follows approval from the New York Department of Financial Services (NYDFS) and marks a significant milestone for Ripple as it seeks to expand its global payment solutions.
What is RLUSD?
RLUSD is a 1:1 USD-backed stablecoin, fully collateralized by:
- US dollar deposits,
- Short-term US government treasuries, and
- Other cash equivalents.
Initially available on Ripple’s XRP Ledger (XRPL) and the Ethereum mainnet, Ripple plans to expand RLUSD to other blockchains and decentralized finance (DeFi) protocols in the near future.
The stablecoin is designed to facilitate real-time cross-border payments, providing instant payouts and seamless conversion between fiat currencies and RLUSD.
RLUSD’s Key Features
- Full Collateralization: Backed by US dollar reserves to minimize price volatility, ensuring stability in cross-border transactions.
- Transparency: Ripple will publish monthly third-party audited attestations of reserve assets to build trust and ensure accountability.
- Regulatory Oversight: An advisory board, including former FDIC Chairman Sheila Bair and Ripple co-founder Chris Larsen, oversees RLUSD’s responsible development.
- Liquidity Support: Liquidity providers B2C2 and Keyrock ensure RLUSD’s smooth operation in the market.
RLUSD complements Ripple’s native token XRP by providing price stability for institutional clients, while XRP contributes to RLUSD’s liquidity within Ripple’s payment solutions.
XRP Price Surge Amid RLUSD Launch
The launch of RLUSD coincides with a significant rally in XRP, which recently reclaimed its position as the third-largest cryptocurrency by market capitalization.
- Price Surge: XRP has surged over 121% in the last 30 days, reaching a seven-year high of $2.89 on December 12.
- Active Accounts: The number of active accounts on the XRP Ledger has increased by 278% since November 1, peaking at 105,956 accounts on December 2, according to XRPScan.
- Market Cap: XRP’s market cap now stands at $144.8 billion, surpassing Tether ($140.5 billion) and Solana ($103.8 billion), according to CoinMarketCap.
As of now, XRP is trading at $2.53 per coin.
Factors Driving XRP’s Bull Run
- Ripple’s Product Innovations:
- Launch of RLUSD and other initiatives, such as the first tokenized money market fund on the XRP Ledger.
- Partnerships and Global Expansion:
- Collaborations with key exchange partners, including Uphold, Bitstamp, Bitso, MoonPay, and CoinMENA, to distribute RLUSD globally.
- Rumored Escrow Backing:
- Speculation that Ripple may use its substantial XRP escrow holdings to back RLUSD, potentially increasing confidence in the stablecoin and reducing the circulating supply of XRP.
- ETF Approval Prospects:
- Applications for XRP spot ETFs by major asset management firms, such as WisdomTree, 21Shares, and Bitwise, could provide institutional investors easier access to XRP, boosting its liquidity and price.
XRP’s Price Outlook: Can It Double?
Independent crypto trader Jacob Canfield predicts XRP could reach $6.60, based on Fibonacci extensions and historical price patterns.
However, XRP might face resistance at the $2.75–$3.00 range before attempting to break its all-time high or experiencing a pullback.
Ripple’s Broader Vision for RLUSD
Ripple’s stablecoin RLUSD is positioning itself as a competitor to major stablecoins like USDC and Tether (USDT). By focusing on regulatory compliance, transparency, and liquidity, Ripple aims to strengthen its foothold in the global payment ecosystem.
Conclusion
Ripple’s launch of RLUSD, combined with XRP’s impressive price rally, signals a promising future for both assets. As RLUSD expands across blockchains and DeFi protocols, and with the potential approval of XRP ETFs, Ripple is poised to redefine the cross-border payment landscape.
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