Ripple President Monica Long explains the dual role the forthcoming RLUSD stablecoin could play alongside XRP for developers and payment utilities.
Long provided this insight during an interview on The Scoop podcast yesterday. Specifically, the host asked her to elaborate on the company’s logic behind launching RLUSD for cross-border transactions despite XRP already fulfilling that functionality, seeking clarification on what stablecoins can do that XRP is not already serving.
Long stated that Ripple considers both assets complementary and additive. She addressed XRP and RLUSD’s complementary roles from the perspectives of two customer sets: payment and developers.
RLUSD and XRP in Payment Utility
In the context of payments, Long noted that there are instances where customers find it more cost-efficient to see transactions completed in US dollars. She highlighted ample market liquidity for major corridors like USD/EUR, making a bridge asset like XRP unnecessary.
Furthermore, Long noted that resource consumers on the XRP Ledger envisioned XRP as a neutral cryptocurrency for use as a bridge asset. Accordingly, since the early days of Ripple, the company has promoted XRP’s use case as a bridge asset for the future of the Internet of Value, where various assets are tokenized on-chain.
Ripple sees XRP as essential for efficient cross-currency or cross-token settlements, particularly for long-tail assets and currencies. Long cited instances with the sub-Saharan African region, Europe, and the Middle East where costs can be very high amid insufficient liquidity. In these scenarios, fees can exceed 10% of the payment, making XRP crucial for the transactions.
RLUSD Serving Developers
Regarding developers, Long noted that the US dollar has been the on-ramp for the entire industry. It is the starting point for buying cryptocurrency or other tokenized assets and trading.
She noted that Ripple sees significant upside potential for the decentralized exchange (DEX) within the XRPL. For the DEX to be more valuable to developers, high-quality stablecoins are necessary.
As a result, Long revealed that Ripple has been focusing more on DeFi, with USD stablecoins being a key component of that ecosystem.
The latest commentary about the complementary role of RLUSD for XRP has attracted significant attention from the XRP community. Vet, a dUNL validator on XRPL, remarked on the interview, providing additional context.
That's a great new interview with Monica Long from Ripple
Monica on the 𝐑𝐢𝐩𝐩𝐥𝐞 𝐔𝐒𝐃 Stablecoin and difference to 𝐗𝐑𝐏
1. 𝐂𝐮𝐬𝐭𝐨𝐦𝐞𝐫 𝐛𝐚𝐬𝐞
RLUSD is focused on two customer bases
🔹 XRP Ledger 𝐃𝐞𝐯𝐞𝐥𝐨𝐩𝐞𝐫𝐬, supported via RippleX
🔹 𝐏𝐚𝐲𝐦𝐞𝐧𝐭… pic.twitter.com/ab2OF8vQWd— Vet 🏴☠️ (@Vet_X0) June 25, 2024
In earlier interviews, other Ripple executives, including CTO David Schwartz, emphasized that the forthcoming stablecoin would benefit XRP rather than dissolve its utilities.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic’s opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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