Ripple has announced testing of its in-house stablecoin, Ripple USD (RLUSD) on the XRP Ledger (XRPL) and the Ethereum mainnet. The goal per Ripple is to create new opportunities, increase liquidity, and offer users, developers, and applications more use cases.
Stablecoins are a type of cryptocurrency designed to maintain a stable value by pegging their worth to a more stable asset, such as a fiat currency like the U.S. dollar or a commodity like gold.
The primary purpose of stablecoins is to offer the benefits of cryptocurrencies, such as decentralization and ease of transfer, while avoiding the high volatility typically associated with digital currencies like Bitcoin and Ethereum.
This testing phase is important to ensure the stablecoin is secure, efficient, and reliable before being widely available. Right now, Ripple USD cannot be bought or traded, and it will only be available after it meets regulatory requirements.
Ripple is a technology company that enhances cross-border payment systems through blockchain-based solutions.
Founded in 2012, Ripple Labs has developed a suite of products for financial institutions, including RippleNet, a global payment network, and the XRP Ledger, which utilizes its native cryptocurrency, XRP.
Despite having a long legal battle with the SEC, Ripple started developing RLUSD in April 2024. This move came after Ripple partnered with the Axelar Foundation to improve connections between blockchains, showing a shift towards stablecoins despite ongoing regulatory challenges with XRP.
Ripple aims to grow its presence in the stablecoin market and offer a more stable option than its native cryptocurrency, XRP.
The current leaders in the stablecoin market which is projected to reach $2.8 trillion by 2028 are Tether (USDT), USD Coin (USDC), Dai (DAI), and First Digital USD (FDUSD).
The new stablecoin will be pegged 1:1 to the US dollar and backed by USD deposits, short-term US government treasuries, and similar assets. Ripple also warned users of fake Ripple USD.
“Ripple USD is not available for purchase or trading at this time,” it said. “Until then, please be cautious of crypto scams that may exploit Ripple’s brand and purport to have early access to sell Ripple USD, which is not available at this time.”
Details of Ripple USD are as follows: XRPL Explorer; ERC-20 Token Address: 0xCfd748B9De538c9f5b1805e8db9e1d4671f7F2ec; and ETH Token Proxy Address: 0x8292Bb45bf1Ee4d140127049757C2E0fF06317eD
Ripple’s lengthy legal battle with the U.S. Securities and Exchange Commission (SEC) over the classification of XRP as a security has finally reached a conclusion. In a recent ruling, Ripple was ordered to pay $125 million in civil penalties, marking the end of the protracted lawsuit.
Judge Torres also issued an injunction preventing Ripple from violating federal securities laws in the future. While she did not explicitly state that Ripple had violated any laws post-lawsuit, she warned that the company could potentially “cross the line.”
Ripple CEO Brad Garlinghouse expressed respect for the court’s decision, hailing it as a victory not only for Ripple but also for the broader crypto industry and the rule of law. He further noted that the SEC’s challenges against the XRP community are now behind them.
