Ripple XRP: From bridge currency to gold-backed stablecoin?
Ripple’s XRP continues to pique interest with its potential transformation from a bridge currency to a gold-backed stablecoin.
In a surprising move, the World Bank has placed XRP in the category of stablecoins during their latest discussions.
Ripple has tons of capital. I’m super interested in your thought here, though. Why move away from #XRP and its utility with progress being made, and many including the World Bank, already classifying #XRP as a stable coin? Thank you for all your research and insight, it’s truly…
— Sean McBride (@seanmcbride16) February 14, 2024
Ripple has been long recognized for its role as a bridge currency in facilitating cross-border transactions with On-Demand Liquidity (ODL). However, there are indications that Ripple could launch a stablecoin on its XRP Ledger to boost its presence and challenge other players in the market.
This potential shift has left many wondering about the implications of an XRP-backed stablecoin and its impact on the broader financial sector.
Versan Aljarrah, the founder of Black Swan Capitalist, stated that XRP could serve an important purpose in the market, especially as there is a growing demand for stablecoins backed by gold.
In a recent post on X, Aljarrah highlighted the demand for a stablecoin backed by gold from various institutions such as the World Bank, International Monetary Fund (IMF), and World Gold Council.
He also mentioned that these organizations have been advocating for the tokenization of gold reserves by central banks. Additionally, it was disclosed that financial analyst Vandell from Black Swan Capitalist and CEO Andy Schectman from Miles Franklin conducted thorough research on XRP and the overall market.
Based on the research, the founder of Black Swan Capitalist stated that XRP could potentially serve as the foundation for a stablecoin backed by gold. This suggests that XRP may transform into a unique stablecoin, distinct from the usual USD-pegged ones.
The tweet referenced a previous post by Aljarrah from July, which emphasized Ripple’s success in defeating the SEC’s claim that XRP is a security.
According to Aljarrah’s post, there will be a change in attention towards Ripple’s stablecoin launch, which has been in the works for a long time on the XRP Ledger (XRPL). As a result, the founder of Black Swan Capitalist reiterated his previous statements.
Additionally, Sean McBride, a former director at Ripple, reacted to the tweet by highlighting similar statements he made recently, stating, “Are you referring to what I brought up yesterday?”
We’ve been vocal about the #WorldBank, #IMF, and World Gold Council openly discussing the need for a #gold-backed #stablecoin for central banks to #tokenize gold reserves
After much research, along with @vandell33 & @MilesFranklinCo we believe #XRP will be the key https://t.co/C55QJaLkOx
— Black Swan Capitalist (@VersanAljarrah) February 16, 2024
Sean McBride Clarifies Ripple’s Stablecoin Hype
McBride was asked by a XRP supporter if the coin’s transformation into a stablecoin is definite. However, the former director of Ripple disagreed and replied,
I believe it is more probable that #XRP will be categorized as a completely unique entity, potentially as a stablecoin for payments.
Sean McBride
It is improbable that #XRP is categorized in the same way. It could be considered as a stablecoin for payments. However, for #XRP to efficiently facilitate cross-border and institutional B2B payments, it cannot be priced at a very low value.
Furthermore, McBride emphasized that the cost of using XRP for large-scale B2B transactions between different countries and organizations could be significantly lower. He also mentioned XRP’s potential as a stablecoin, as the World Bank has acknowledged it to be.
However, there has been widespread doubt and questioning surrounding the World Bank’s position.
According to the XRP community and other cryptocurrency supporters, the World Bank has categorized XRP as a stablecoin after Ripple’s XRPL announced its intentions to release a stablecoin several years ago.
As a result, the claims of XRP potentially becoming a stablecoin hold less credibility for those who disagree with the World Bank’s viewpoint.
Skepticism and Debate within the Crypto Community
While some enthusiasts are excited about the potential benefits of a gold-backed XRP stablecoin, others are skeptical or even dismissive of the idea. Critics argue that Ripple might lack the necessary resources and regulatory compliance to successfully implement such a complex project.
Others believe that a gold-backed stablecoin would not offer significant advantages over existing stablecoins in terms of stability or functionality.
However, as the crypto landscape continues to evolve and mature, it’s essential to remain open to innovative ideas and potential transformations within the ecosystem.
Joshua Downes
Joshua Downes is an experienced journalist and editor specialising in finance, trading, cryptocurrency and online betting. Over the last eight years, he has written for numerous publications and media outlets, both print and online. These include Trading-Education, Wetten, GamblingGuy, BitReviews, Industry Slice, and Gulf Business. With a BA in journalism and an MA in English, Joshua aims to provide informative and highly readable articles, making even the most complex of financial concepts easily understandable for the average reader. Joshua is currently pursuing professional qualifications in finance and also has extensive knowledge of the gambling industry, having spent four years working in operations for Gala Coral.
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