Decoding XRP’s Role in the Stablecoin Debate: Unveiling the Ripple Effect
Mr. Huber, a highly regarded individual within the XRP community, recently expressed curiosity as to why Ripple has not yet unveiled its stablecoin on the XRP Ledger (XRPL), despite its significant contribution to the network’s growth. Unlike other blockchain platforms, Ripple has utilized the XRPL for various products, such as Ripple Payments, but has refrained from launching a stablecoin.
Questioning Ripple’s Strategy
As an on-chain investigator, Mr. Huber posed several straightforward inquiries that shed light on the absence of a liquid stablecoin within the XRPL ecosystem. While Ripple is just one of many builders within the XRPL community, it holds the distinction of being the largest contributor to its development.
Mr. Huber finds this situation to be peculiar, especially considering the widespread popularity of stablecoins across various networks. For instance, COTI introduced DJED on the Cardano mainnet in January of the previous year, while Near Protocol incorporated USDC in September 2023.
Ripple Focuses on Grander Plans for XRP
Upon further examination of stablecoins like Stably USD (USDS) on the XRPL, Mr. Huber discovered that Ripple has not ventured into developing its own stablecoin for its range of products. Instead, the company continues to employ XRP as a bridge currency for facilitating cross-border settlements, despite the volatility associated with it.
The analyst posits that Ripple’s dedication to this approach is primarily due to the instantaneous nature of cross-border transactions facilitated by XRP. Furthermore, he speculates that Ripple may be exploring the potential of XRP as a bridge currency between central bank digital currencies (CBDCs) from different nations.
Based on Mr. Huber’s analysis, these factors could potentially explain why Ripple has not introduced a stablecoin to the XRPL. While some members of the community entertain the idea that Ripple may be considering utilizing XRP as a stablecoin, others suggest that competition within the stablecoin market might be influencing Ripple’s decision. However, these speculations remain unsubstantiated, and Ripple’s rationale for abstaining from introducing a stablecoin to the XRPL remains unclear.
Tags
Ripple (XRP)