The Ripple CTO has cautioned investors against seeing the forthcoming Ripple stablecoin RLUSD as an opportunity to record substantial returns.
Ripple‘s RLUSD launch plans have been a source of significant excitement in the XRP community in recent months. Proponents expect that the stablecoin will bolster liquidity and DeFi activity on the XRP Ledger, all of which could support XRP’s price.
Following the recent New York State Department of Financial Services (NYDFS) green light, anticipation of the product’s launch is reaching a fever pitch, sparking a note of caution from Ripple CTO David Schwartz.
“Not an Opportunity to Get Rich”
Ripple CTO David Schwartz has warned against panic buying RLUSD at launch.
“Please don’t FOMO into a stablecoin! This is not an opportunity to get rich,” the Ripple exec stressed in an X post on Sunday, December 15.
As RLUSD goes live, there may be supply shortages in the very early days before the market stabilizes. There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD. Tools will show you the highest price anyone is willing to pay, even if it's just for a… https://t.co/LOx4rGiiiJ
— David "JoelKatz" Schwartz (@JoelKatz) December 15, 2024
The warning came as a pre-market valuation of 1 RLUSD at over 500 XRP worth more than $1,200 made the rounds online.
Supply Shortages
Schwartz attributed the high valuation to RLUSD supply shortages expected at launch. In October 2024, The Crypto Basic reported that Ripple had minted over $47 million worth of RLUSD as it continued to test the product.
The recent pre-market valuation could suggest that the current demand significantly outweighs this available supply. But this is not something that Schwartz expects to last long after launch.
“The whole point of a stablecoin is to have a stable price. Short-term changes in prices due to shortages of supply or demand are certainly possible, especially around launch, but they shouldn’t remain for very long as arbitragers [sic] rapidly fix the market,” he warned.
According to the Ripple CTO, RLUSD’s price not stabilizing at $1 will suggest “something is very seriously wrong.”
Wen RLUSD Launch?
The recent warning from Schwartz has again sparked a flurry of questions about the launch date of the long-anticipated stablecoin.
While speculation is high that the product will launch before 2024 ends, Ripple has not offered any confirmation, with CEO Brad Garlinghouse urging the community to wait for an official announcement.
Nonetheless, the firm has long been pursuing exchange partners for RLUSD, suggesting a launch sooner rather than later. In October 2024, the firm noted that initial partners include MoonPay, Bitso, Bitstamp, Uphold, Independent Reserve, Bullish, and CoinMENA.
DisClamier: 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 opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
