In a recent X post, the XRP community figure, Mickle has sparked a debate over the volatility of crypto assets like XRP and their day-to-day payment transactions, citing remarks from Ripple’s CTO, David Schwartz.
Schwartz in his remarks discussed the possibility of cryptocurrencies becoming more stable as they witness greater real-world adoption. He indicated that real-world use cases would naturally lead to reduced volatility.
The Pathway To Crypto Stability
David shared his remarks when he was asked to comment on whether there will ever be truly stable cryptos that are not centrally controlled. He noted projects like DAI, a crypto-collateralized stablecoin that maintains its value through a claim on an Ethereum pool.
He explained that while these types of stablecoins are not entirely decentralized due to the need for a centralized price feed, they depict a step towards a more stable cryptocurrency ecosystem. “If those projects are successful, we could see more stability in the market,” he said.
He further added “We could see cryptocurrencies themselves become more stable as they get real-world adoption,” Schwartz explained. “Real-world use cases, I think, will lead to stability.”
XRP Community Aims For Stability With AMM
Notably, some XRP community members believe that XRP would be more favorable if it signified stability rather than the fierce volatility in the crypto market. They argue that a more stable XRP would be better suited for cross-border payment transactions, where entities using XRP need not worry about significant price fluctuations.
Some XRP community members weighed in a scenario where AMMs could help XRP adopt stablecoin features that would appeal to banks.
Also, recently, the Digital Perspectives PermaBull (DPP) channel host sought insights from Elon Musk’s AI Grok regarding the potential for XRP to evolve into a stablecoin, leveraging AMMs as a stabilizing mechanism. In response, the AI tool confirmed that it was feasible for XRP to transition into a stablecoin with AMMs. This mechanism could effectively control XRP’s price volatility which would improve confidence among adopters.
On the other side, critics have ironically remarked that XRP already has enough stability due to its poor price performance over an extended period.
Given the mixed opinions, what do you think? Will we ever witness truly stable cryptocurrencies?
Source: https://coinpedia.org/news/ripple-cto-suggests-real-world-use-case-could-reduce-crypto-volatility/