Ripple's RLUSD Stablecoin Might Initially Be Available Only to Institutional Investors

Ripple CTO David Schwartz revealed this during a September 8 exchange with an XRP user on social media.

Ripple’s upcoming USD-pegged stablecoin, RLUSD, might initially be available only to institutional investors, according to new insights.

Ripple CTO David Schwartz unveiled this during a September 8 exchange with an XRP user on social media.

The XRP user had suggested that RLUSD should be limited to large financial institutions and not be made available to retail users. His reasoning was to protect the stablecoin from potential misuse in illegal activities like money laundering. He also highlighted the need to safeguard RLUSD from potential risks.

Schwartz’s response seemed to confirm that RLUSD will likely remain exclusive to institutions. He drew a comparison to stablecoins like USDC and USDT, noting that individual investors typically cannot purchase these stablecoins directly from the issuers.

“Probably only ever be available directly to institutions. Can you get USDC from Circle or USDT from Tether, because I can’t,” he stated.

Schwartz's comments follow an announcement earlier this year by Ripple CEO Brad Garlinghouse about the upcoming launch of the USD-pegged stablecoin. Introduced in April and currently being tested on both the XRP ledger and Ethereum, RLUSD is designed to serve as a secure payment tool that bridges traditional finance and decentralized finance (DeFi) while complementing XRP.

In a bid to ensure transparency, Ripple will be issuing monthly reserve attestations for RLUSD, which will be fully backed by US dollars and short-term US government bonds.

The launch of Ripple's stablecoin comes amid rising competition in the stablecoin sector. These digital assets are among the few cryptocurrencies with broad real-world applications. Their price stability enables traders to bypass the volatility of other crypto assets while offering emerging market users access to US dollars.

According to data from DeFillama, USDT and USDC currently dominate the stablecoin market, holding about 90% of the market share with a combined market cap of over $150 billion.

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