Ripple’s RLUSD stablecoin might initially be available only to institutional investors, according to new insights.
Ripple CTO David Schwartz revealed this during a September 8 exchange with an XRP user on social media.
Ripple’s RLUSD Stablecoin Targets Institutions
The XRP user suggested that RLUSD should be limited to large financial institutions, not 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 confirmed that RLUSD will likely remain exclusive to institutions. He drew a comparison to 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.
Read more: A Guide to the Best Stablecoins in 2024
Schwartz’s comments follow Ripple CEO Brad Garlinghouse’s recent announcement about the upcoming launch of the USD-pegged stablecoin. RLUSD, which was introduced in April and is currently being tested on both the XRP ledger and Ethereum, aims to serve as a secure payment tool. It’s designed to bridge traditional finance and decentralized finance (DeFi) while complementing XRP.
Ripple plans to deliver a seamless user experience globally and ensure transparency by issuing monthly reserve attestations. RLUSD will be fully backed by US dollars and short-term US government bonds.
Meanwhile, Ripple’s stablecoin launch 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.
Read more: Everything You Need To Know About Ripple vs SEC
DeFillama reports that 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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