Ripple, the blockchain firm responsible for establishing the XRP Ledger, intends to launch a stablecoin linked to the US dollar, initially deploying it on both Ethereum’s ERC-20 token standard and its institution-focused XRP Ledger.
Ripple President Monica Long said in a statement on Thursday that “issuing our stablecoin on the XRP Ledger and Ethereum will serve as a pivotal entry point to unlock new opportunities for institutional and DeFi use cases across multiple ecosystems.”
Long went on to say, “The XRP Ledger’s native features, which include a decentralized exchange and an automated market maker, were designed to use XRP as the bridge asset. Introducing a reliable stablecoin to XRPL will increase adoption and growth, contributing to a thriving ecosystem.”
The stablecoin would be backed by “USD deposits, short-term U.S. government treasuries, and other cash equivalents,” according to the business. It is set to launch later this year. “These reserve assets will be audited by a third-party accounting firm, and Ripple will publish monthly attestations.”
The two most popular USD-pegged stablecoins currently are USDC from Circle Internet Financial and USDT from Tether. According to a Ripple statement, the stablecoin market, which is presently worth more than $150 billion, is expected to reach $2.8 trillion by 2028.
Ripple’s Chief Technology Officer, David Schwartz, remarked that “in retrospect,” he and his team would have preferred to launch a stablecoin earlier. However, he stated that it makes strategic sense to release one this year after learning more about the market and monitoring economic developments.
“The interest rate increase makes it a much more attractive market,” he said. “There’s also been a shakeup, and Tether is almost a no-go for us due to regulatory concerns. There is just so much ambiguity surrounding it.”
