Ripple Insider Reveals How RLUSD Will Boost XRP

A former Ripple employee has provided detailed insights on how Ripple’s upcoming RLUSD stablecoin will benefit XRP rather than harm it.

This insight was shared in a conversation with Tony Edward, the host of the Thinking Crypto podcast. Notably, this Ripple alum was part of the team that developed Ripple’s On-Demand Liquidity (ODL) product, now known as Ripple Payments.

RLUSD Will Be Paired with XRP for Greater Liquidity

The former employee revealed they have long advocated for Ripple to launch a stablecoin. When asked whether RLUSD could negatively impact XRP, they suggested quite the opposite.

According to their insights, the stablecoin is expected to be paired with XRP, benefiting from greater liquidity, as XRP is tradable on virtually all crypto exchanges globally.

Moreover, the connection between XRP and RLUSD is expected to help stabilize the stablecoin, preventing de-pegging issues that have challenged other stablecoins. The former Ripple insider emphasized that RLUSD will unlock new opportunities in forex and other financial sectors.

Concerns About RLUSD Arrival

Notably, crypto community members who argue that RLUSD’s arrival will negatively impact XRP often theorize that Ripple is moving away from XRP for cross-border payment processes to a stablecoin alternative. They believe RLUSD aims to usurp XRP’s position in Ripple’s payment network.

However, reputable figures in the XRP community, including top executives at Ripple, have reiterated that RLUSD would benefit XRP rather than harm it. Ripple CTO David Schwartz emphasized this perspective during the 2024 XRP Ledger Apex summit.

He explained that the evolution of DeFi has highlighted the importance of stablecoins. They serve essential functions like pricing and trading while avoiding market exposure. 

Schwartz noted that different asset classes are needed for effective DeFi participation and emphasized that liquidity in trading favors XRP. He stated that introducing RLUSD will enhance use cases rather than diminish XRP’s utility.

Ripple CEO Brad Garlinghouse echoed this sentiment, stating that RLUSD will complement the XRP ecosystem by providing better liquidity and on-ramps, ultimately supporting the growth of XRP. This counters concerns that RLUSD would undermine XRP’s existing functions.

XRP Army Reacts

In response to a recent comment by a former Ripple employee, members of the XRP community expressed their agreement. Vet, an XRPL validator, stated that RLUSD is a net benefit for the XRP Ledger, noting that anything contrary to this is merely FUD.

Also, Vet acknowledged that having RLUSD sooner would have been preferable. However, he pointed out that it’s easy to say that in hindsight. Another commenter remarked that this issue has long been settled and that a former Ripple employee does not need to clarify it.