Ripple Announces Plan to Launch New Stablecoin

On Thursday (04/04), Ripple revealed its plan to deploy a stablecoin across two blockchain networks: Ethereum and Ripple.

Ripple announces plan to launch new stablecoin

It's known that the stablecoin will be issued later this year with assets backed by USD, short-term US Government bonds, and other "cash equivalent" assets. Ripple stated there will be monthly asset audits conducted by a third party.

Ripple's CTO, David Schwartz, shared:

"We believe we are taking an appropriate approach to the market. We have branches of products in both organizational and payment areas. On the Ledger blockchain side, we also have corresponding DeFi product branches. These are pieces where stablecoins are most used today."

Additionally, this leadership also shared that their stablecoin will have legal ties to entities in the US and will be "easier than the current approach used by competitor Tether." Tether is currently headquartered in the British Virgin Islands.

Ripple believes that one day users in the US may "deposit stablecoins at banks and integrate business segments into everyday applications with traditional financial markets."

This move is seen as expanding options for stablecoins on the Ledger network of the project. Alongside this, typical DeFi product areas such as AMM exchanges will also be supported after the introduction of a new stablecoin asset solution.

In addition to Ethereum and the XRP Ledger, the company plans to expand to many other blockchain networks as demand continues to grow.

The price of XRP is slightly increasing at the time of writing due to Ripple's upcoming release of its own stablecoin.

1-hour chart of XRP/USDT pair on Binance at 09:05 PM on April 4, 2024

Stablecoin has been a hot keyword recently, dominated by two traditional mechanism names: USDT and USDC. Alongside this, recent discussions have erupted between MakerDAO and Aave, as well as the high-yield model of Ethena, relating to this asset type.