XRP Set For $160 Billion Market Shake-up As Ripple Kicks Off Testing Of Its Much-Hyped Stablecoin
San Francisco-based cross-border payments company Ripple announced on Friday that it had begun testing its USD-backed stablecoin on its native blockchain, XRP Ledger, and the second largest crypto network, Ethereum (ETH).
Ripple revealed earlier this year that it would launch its own stablecoin as it forays into the $160 billion stablecoin market — currently dominated by Tether’s USDT and Circle’s USDC token.
Meanwhile, bears have dragged the XRP price below the $0.60 mark.
Ripple’s Stablecoin Enters Beta Phase On XRP Ledger And Ethereum
In a major milestone for Ripple, the company has started testing its game-changing stablecoin, Ripple USD (RLUSD).
“We’re excited to share that Ripple USD (RLUSD) is now in private beta on XRP Ledger and Ethereum mainnet, and is being rigorously tested by our enterprise partners,” Ripple said in an Aug. 9 X blog post. “This phase is crucial for ensuring that the stablecoin meets the highest standards of security, efficiency, and reliability before it becomes widely available and after receipt of regulatory approval.”
This is a significant milestone and a step closer to bringing more high-quality assets to the XRP Ledger, driving new opportunities, liquidity, and institutional use cases for users, developers, and applications.
— Ripple (@Ripple) August 9, 2024
However, Ripple emphasized that RLUSD has yet to receive a regulatory nod and, thus, is not available for purchase or trading. The fintech firm has asked users to be wary of potential scams claiming early access to the stablecoin.
Ripple indicated that RLUSD would help fulfill worldwide demand for stablecoins. Moreover, the company will offer clients the stablecoin and XRP for global payment services.
USDT And USDC Rival
The announcement today came after Ripple made its bold move into the fast-growing stablecoin sector in April. The company then revealed the name of its stablecoin project at the XRP Ledger Community Summit in June.
Set to roll out later this year, Ripple’s stablecoin will be fully backed by U.S. dollars, short-term U.S. government treasuries, and cash equivalents. Ripple said it will report monthly attestations of its reserves backing the stablecoin, which a third-party accounting firm will audit.
The current $160 billion stablecoin market is an important component of infrastructure in the cryptosphere utilized for trading and payments on blockchains. The two biggest stablecoins, Tether’s USDT and Circle’s USDC, currently dominate the market. Broker Bernstein previously predicted that the stablecoin market could rise to $2.8 trillion in the next five years.
Ripple’s Friday announcement comes after the firm claimed victory against the Securities and Exchange Commission in its long-standing case.
XRP traded for $0.5782 per coin as of press time, representing a 6.9% decrease in the past 24 hours, according to CoinGecko.