Fintech company Ripple announced a critical move on Thursday. In this context, it announced that it will launch its own stablecoin pegged to the US dollar on the Ethereum and XRP Ledger Blockchains. Following this development, the XRP price made a vertical rise.
Ripple announced its stablecoin move, XRP jumped!
According to the statement made by Ripple, the stablecoin will enter the market towards the end of this year. Meanwhile, Ripple has not yet announced the name of the project. However, he noted that the stablecoin will be fully backed by the US dollar, short-term US government treasuries and “other cash equivalents”. Ripple also noted that a third-party accounting firm will audit the stablecoin. He explained that this firm will provide monthly confirmations of its assets backing the stablecoin. In this context, Ripple started its announcement with the following statements:
The stablecoin market is growing rapidly. It is approximately $150 billion today and is estimated to exceed $2.8 billion by 2028. There is a clear demand for security, stability and utility.
Following this development, Ripple’s native token XRP started to rise. XRP made a vertical rise from its intraday low of $0.575 to $0.61. The token was trading at these levels at the time of writing.
David Schwartz: We saw a clear opportunity in this space!
Ripple Chief Technology Officer David Schwartz said the firm believes the current $150 billion stablecoin market is poised to explode into a trillion-dollar market in the coming years. He stated that they see a clear opportunity in this field. In this regard, Schwartz underlined the following points:
We believe we are uniquely positioned to make a competitive entry into this market. We have a presence both on the institutional side with our payments product and on the XRP Ledger side, we have some penetration into the DeFi part of the space. These are the two big buckets where stablecoins are used today.
“We won’t do the easiest thing!”
Ripple is an XRP-powered crypto payment platform and enterprise blockchain provider. The company has been watching this area closely for years. cryptokoin.comAs you can see from , Tether (USDT) and USDC currently dominate the stablecoin space. Schwartz explained Ripple’s situation as follows:
We have a strong balance sheet. We’ve been around for a very long time. We have great compliance, we’ve been doing payments compliance for almost eight years. We have an impressive license package.
Schwartz said Ripple decided “there had to be a US jurisdiction connection” around its stablecoin. He also added that “the easiest thing to do would be like Tether does.” By the way, Tether is headquartered in the British Virgin Islands. But Ripple hopes to see a day when US customers can “deposit a stablecoin in your bank” and combine institutional and individual use cases with the traditional financial space.
ripple, nWhy is a stablecoin being launched now?
Schwartz said the idea had been floating around at Ripple for a while, jokingly at first. He stated that there were conversations such as “This makes our lives easier.” The more he thought about the idea, he said, the more it actually made sense. Reasons for this include demand from emerging markets that do not have access to dollarized assets and the interest of corporate firms in the use of stablecoins. Schwartz noted that Ripple is talking to customers who are not using existing stablecoins and asking why.
Schwartz added that there are not many large stablecoins on the XRP Ledger. He also stated that Ripple supports expanding use cases in Blockchain. Schwartz emphasized that there is a need for another important asset in Blockchain besides XRP.
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