XRP issuer Ripple is moving forward with its stablecoin plans after CEO Brad Garlinghouse raised the idea during a 2024 consensus.
Ripple (XRP) has begun work on a fiat-pegged token called Ripple USD, or RLUSD, as the company eyes the $160 billion stablecoin market currently dominated by Tether (USDT). The digital payments giant He said Private beta tests have begun on the XRP ledger and Ethereum mainnet, the second-largest cryptocurrency blockchain by market cap.
At the Consensus 2024 conference, Garlinghouse told attendees that the stablecoin market has a high ceiling and could become a $3 trillion industry before 2030. Ripple CEO Monica Long also indicated that XRP is likely to launch its own stablecoin token this year.
In an announcement on August 9, Ripple said that RLUSD will operate as a 1:1 backed currency to the US dollar. The company plans to use cash deposits, government bonds, and their equivalents as reserves. Ripple also pledged to issue monthly certifications and use an external accounting firm for audits. The official statement indicates a move toward regulatory compliance and approval.
Ripple Enters the Stablecoin Industry
Entering the stablecoin market means competing directly with incumbents like Tether and Circle’s USD Coin (USDC), even if Ripple’s CEO has stressed that there is enough room for all players to grow.
Specifically, Circle has demonstrated its ability to comply with comprehensive stablecoin regulations in Europe. Circle is also preparing for an IPO in the US and could become the first stablecoin company to list its shares.
US policymakers are considering regulations for stablecoins that would give banks the green light to get involved in the space. Lawmakers including Patrick McHenry and Maxine Waters have reportedly made progress toward such a bill.