Ripple CTO Warns of RLUSD Launch Volatility, Stresses It’s ‘Not an Opportunity to Get Rich’
Highlights:
- Schwartz cautions that RLUSD may experience price fluctuations, advising against buying out of FOMO.
- The launch of RLUSD could trigger temporary price surges due to possible supply shortages.
- Ripple’s RLUSD stablecoin gains approval and is set to compete with USDT and USDC in the market.
In a post dated December 15, David Schwartz, the Chief Technology Officer (CTO) of Ripple, said Ripple’s US Dollar-pegged stablecoin, RippleUSD (RLUSD), could face price volatility. He cautioned against buying due to FOMO (Fear of Missing Out), stressing that RLUSD is not an investment opportunity.
Schwartz highlighted that certain pre-launch bids were inflating the price of the unreleased stablecoin. He responded to a post where 1 RLUSD was valued at approximately 511 XRP, or $1,244 at current rates, on a Ripple wallet named Xaman. He clarified that RLUSD may experience supply shortages upon launch. These shortages could cause temporary price spikes before the market stabilizes. Schwartz also mentioned that someone is willing to pay $1,200 for a tiny fraction of one RLUSD.
He stated:
“There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD. Tools will show you the highest price anyone is willing to pay, even if it’s just for a tiny bit. Maybe someone wants the ‘honor’ of buying the first bit of RLUSD on the DEX.”
“Not an Opportunity to Get Rich”
Ripple CTO stressed that a stablecoin should maintain a stable price. It is not for making quick profits. “Please don’t FOMO into a stablecoin! This is not an opportunity to get rich,” he added.
As RLUSD goes live, there may be supply shortages in the very early days before the market stabilizes. There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD. Tools will show you the highest price anyone is willing to pay, even if it's just for a… https://t.co/LOx4rGiiiJ
— David "JoelKatz" Schwartz (@JoelKatz) December 15, 2024
Ripple’s RLUSD Stablecoin Receives Approval, Set for Launch Soon
On December 11, Ripple CEO Brad Garlinghouse announced that RLUSD received final approval from the New York Department of Financial Services. The official Ripple account also stated that the stablecoin would launch soon. Once RLUSD is available, Ripple plans to use RLUSD and XRP in its cross-border payments, which, according to the beta testing announcement, will help serve global customers.
This just in…we have final approval from @NYDFS for $RLUSD! Exchange and partner listings will be live soon – and reminder: when RLUSD is live, you’ll hear it from @Ripple first.
— Brad Garlinghouse (@bgarlinghouse) December 10, 2024
The XRP community eagerly anticipates the launch of the RLUSD stablecoin. The stablecoin will be accessible on both the XRP Ledger and Ethereum blockchains. According to Ripple, RLUSD will be fully backed by cash and reserves and can be redeemed 1:1 for US dollars. Ripple President Monica Long said that RLUSD is meant to be “complementary and additive” to XRP. Garlinghouse said RLUSD will mainly target large institutional players. The goal is to use XRP’s high availability on exchanges to support RLUSD’s liquidity.
Ripple is entering the stablecoin market. It will compete with big players like Tether’s USDT and Circle’s USDC. These stablecoins dominate the market, with market caps over $140 billion and $42 billion, according to CoinGecko. Despite tough competition, Ripple sees an opportunity for credible players to gain market share. Schwartz predicts the stablecoin market could exceed $2 trillion by 2028.
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Syed Ali Haider
Syed Ali Haider is a contributing crypto writer for Crypto2Community. He is a crypto and blockchain journalist with over six years of experience. Syed Ali is a Blockchain enthusiast and writer passionate about enhancing the acceptance, adoption, and integration of Blockchain technology worldwide. He has also advocated for digital freedom and cybersecurity for many years. Haider has been featured in a number of high-profile crypto and finance outlets, including Coincult and more.
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