Investors Can Trade Ripple’s New Stablecoin, RLUSD, Starting Tuesday
Ripple’s new dollar-backed stablecoin, RLUSD, will be available for trading on certain global exchanges starting Tuesday, following approval from the New York State Department of Financial Services earlier this month. The stablecoin will be issued on the Ethereum blockchain and XRP ledger.
RLUSD will not be available on Coinbase or Robinhood at launch, but it is expected to expand to other exchanges in the coming weeks. The stablecoin is designed to be a more cost-effective and operationally efficient option for cross-border payments, with Ripple’s senior vice president of stablecoins, Jack McDonald, citing the growth of stablecoin use in cross-border payments as a key driver for its development.
The launch comes at a time of increased hope for clearer and friendlier U.S. regulations in the crypto industry, following a 2020 lawsuit against Ripple by the Securities and Exchange Commission. The market cap for dollar-backed stablecoins has grown 50% this year and 15% since the election, with Tether (USDT) dominating with around 70% market share.
McDonald noted that there is a desire for alternative stablecoins to the current market leaders, with regulatory bodies and new institutions expressing concerns about the concentration of the market. Ripple is primarily looking to use RLUSD to complement its existing business, which focuses on cross-border payments, and sees a place for both XRP and stablecoins in this space.
XRP is the native token of the XRP ledger, created by the founders of Ripple in 2012, and is used in the company’s cross-border payments business. The launch of RLUSD on both Ethereum and XRP ledger is expected to generate more need for XRP as a bridge asset on the XRP ledger, which will be beneficial for the token.