Ripple President Calls US Dollar Stablecoin as Ripple Readies to Test RLUSD

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As a seasoned crypto investor with over a decade of experience navigating the volatile digital asset landscape, I can’t help but feel both intrigued and cautious about Ripple’s latest move towards stablecoins. The concept of stablecoins isn’t new to me – I’ve seen them rise, fall, and rise again.

Ripple‘s official account, a key player in the cryptocurrency world, recently shared a brief video as part of their “Explain Crypto in 60 Seconds” series. The CEO, Monica Long, was featured in this video, providing insights on stablecoins to the wider crypto community.

As a researcher, I recently came across a video that was published post the announcement of Ripple initiating the closed beta testing phase for their stablecoin, Ripple USD (RLUSD).

Ripple begins to test RLUSD

In the discussed segment of the video, the Ripple president explained that stablecoins are digital tokens linked to actual currencies on a blockchain, and there’s a direct match between the value of a stablecoin and the currency it’s backed by. She pointed out the U.S. dollar as an extensively used example of a stablecoin.

Today, we’re pondering over stablecoins… Once again, Monica Longsf takes center stage for our #CryptoInOneMinute segment to address the query, “What exactly is a stablecoin?”

— Ripple (@Ripple) August 9, 2024

As a seasoned cryptocurrency enthusiast with years of experience under my belt, I am always eager to learn about new developments in this rapidly evolving field. This week, I was excited to hear about Ripple’s latest announcement – the beta testing of their stablecoin, RLUSD. However, it seems that this coin is not yet available for purchase or sale, which is a bit disappointing as I would love to get my hands on it and test it out myself. That being said, I understand the importance of thorough testing before releasing any new cryptocurrency into the market, especially one backed by a reputable company like Ripple. I am confident that their selection of corporate partners for this beta testing phase will provide valuable insights and help ensure the success of RLUSD in the long run. Here’s to hoping that I will eventually get the chance to use it!

Once Ripple receives full approval from regulatory bodies, they plan to release their stablecoin across multiple platforms, including the XRP Ledger, Ethereum, as well as additional blockchain networks.

Are stablecoins really stable?

Currently, the widely used stablecoins are Tether’s USDT and Circle’s USDC, which are backed by U.S. dollars. Tether additionally holds U.S. Treasuries as a backup for its stablecoin. Nevertheless, last year in March, USDC temporarily became unlinked from the dollar due to the collapse of three significant U.S. banks – Silicon Valley Bank, Signature Bank, and Silvergate Bank – during the banking crisis that occurred then. Similarly, USDT has faced scrutiny as regulators and numerous crypto companies have questioned whether Tether possesses sufficient USD reserves to cover all the USDT they issue swiftly and frequently across multiple blockchains.

Numerous crypto investors lack faith in stablecoins because they have a general mistrust of the traditional financial system, particularly the U.S. dollar, and its increasing national debt (currently $35 trillion). Consequently, they choose to keep their assets in Bitcoin and other digital currencies instead.

In May 2022, when the Terra blockchain’s algorithm-backed stablecoin, UST, depegged from the dollar and plummeted, many people grew more skeptical. This event led to a substantial drop in the overall crypto market and the price of Bitcoin as well.

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2024-08-10 19:08