Ripple, the provider of enterprise blockchain and crypto solutions, plans to launch a stablecoin, pegged 1:1 to the US dollar (USD).
Ripple’s stablecoin will be 100 per cent backed by US dollar deposits, short-term US government treasuries, and other cash equivalents. These reserve assets will be audited by a third-party accounting firm, and Ripple will publish monthly attestations.
The stablecoin market is about $150billion, and is forecasted to exceed $2.8 trillion by 2028. There’s clear demand for stablecoins that deliver trust, stability, and utility. To meet this growing demand, Ripple will issue a stablecoin, leveraging its decade-plus of experience building real-world financial solutions for institutions around the world.
At launch, the stablecoin will be available on the XRP Ledger (XRPL) and Ethereum (ETH) blockchains, with plans to expand to additional blockchains and decentralised finance (DeFi) protocols and apps over time.
“This is a natural step for Ripple to continue bridging the gap between traditional finance and crypto,” said Brad Garlinghouse, Ripple CEO. “Institutions entering this space are finding success by partnering with compliant, crypto-native players and Ripple’s track record and resiliency speaks for itself, as we launch new products and acquire companies through multiple market cycles. This move is also monumental for the XRP Ledger community, driving more use cases, liquidity and opportunities for developers and users.”
“Issuing our stablecoin on the XRP Ledger and Ethereum will serve as a pivotal entry point to unlock new opportunities for institutional and DeFi use cases across multiple ecosystems,” added Monica Long, Ripple president. “The XRP Ledger’s native capabilities, including a decentralised exchange and automated market maker, were built to utilise XRP as the bridge asset Bringing a trusted stablecoin onto XRPL will drive more adoption and development, contributing to a vibrant ecosystem.”
Key benefits of Ripple’s stablecoin include:
Ripple specialises in blockchain-based enterprise grade solutions that financial institutions and enterprises need. Ripple will leverage both XRP and the stablecoin in its payment solution to further improve the customer experience and serve as the first enterprise use-case of the asset at scale. There is demand from Ripple’s customers in emerging markets to enable stablecoin payouts.
Ripple is committed to regulatory compliance and has a growing license portfolio in key regions around the globe. The company and its subsidiaries collectively hold a New York BitLicense, nearly 40 money transmitter licenses across the US, a Major Payment Institution License from the Monetary Authority of Singapore, and a Virtual Asset Service Provider registration with the Central Bank of Ireland.
Earlier this year, Ripple agreed to acquire Standard Custody, one of the few crypto companies that holds a NY Trust Charter. In doing so, it expanded its license footprint to better serve enterprise customers. – liquidity on the decentralised exchange (DEX).
Working on the XRP ledger
While XRP is the native currency on the XRPL, the Ledger was built to support any type of asset issued to trade on the DEX and quickly settle anywhere in the world with low transaction costs. Bringing more credible assets on the DEX, such as Ripple’s stablecoin, will drive numerous benefits for users, developers, and apps.
Backed by a 1:1 reserve of cash and cash equivalents, Ripple’s stablecoin is designed to ensure transparency and reliability. Once the stablecoin is available, Ripple will publish monthly attestations of the assets.
The Ripple stablecoin will be issued on the XRP Ledger. It will also be issued on the Ethereum network using XRPL native functionality and ERC20 token standards. Developers on both XRPL and ETH will be able to incorporate the Ripple stablecoin so that users can transact with stability, confidence, and trust. Furthermore, The Ripple stablecoin will expand native issuance to other blockchains, allowing users to benefit from cross-chain interoperability.
