Ripple, a company offering blockchain and cryptocurrency services for businesses, announced its intention to launch a stablecoin that maintains a value equal to one US dollar.

The asset is fully collateralized with US dollars, short-term U.S. Treasury bonds, and other liquid funds.

Ripple CEO Confident on Launch

Based on a press release from April 4, an independent accounting firm will conduct regular audits of these reserves, and the results will be made publicly available every month.

Brad Garlinghouse, the CEO of Ripple, expressed optimism about the decision, commenting, “This is a logical progression for Ripple as we work to bring together the worlds of traditional banking and cryptocurrency.”

The executive emphasized the growing advantage of financial institutions collaborating with crypto industry leaders who are compliant by nature. He pointed to Ripple as an example of this trend, noting its consistent achievements and ability to thrive during market fluctuations.

He points out the wider effects of the stablecoin debut for the cryptocurrency world. Initially, it will be accessible on the XRP Ledger (XRPL) and Ethereum (ETH) platforms, with intentions to broaden its reach to further networks and decentralized finance (DeFi) systems in due time.

Monica Long, president of Ripple, highlighted the significant change that releasing a reliable stablecoin onto XRPL would bring about. According to Long, “Introducing a trusted stablecoin on XRPL will attract more users and developers, leading to a thriving community.”

Key Benefits

Ripple’s stablecoin offers several advantages, such as its robust and business-focused design, strict compliance approach, access to liquidity through Decentralized Exchanges (DEXs), clear reserve transparency, and the ability to work across multiple blockchain networks.

Ripple focuses on creating blockchain-based options for financial organizations and businesses. They plan to incorporate both XRP and their stablecoin into their payment platform, responding to the increasing need for these types of transactions in developing countries.

The introduction of Ripple’s stablecoin to the Decentralized Exchange (DEX) on the XRP Ledger will significantly increase liquidity, as it offers a reliable asset for trading. This development is advantageous for users, developers, and applications, enabling them to carry out low-cost, efficient transactions across the globe in a timely manner.

Ripple places great importance on following regulations, as demonstrated by its collection of licenses in various parts of the world. This includes obtaining a BitLicense from New York and multiple money transmitter licenses within the United States. The latest acquisition of Standard Custody is another step forward in this regulatory commitment.

The stablecoin will have a 1:1 backing by cash and cash equivalents for each token issued, providing transparency and assurance through routine monthly reports detailing this reserve once it becomes operational.

The stablecoin can be issued on two blockchain platforms, XRP Ledger and Ethereum. It will utilize XRPL’s native features and adhere to ERC20 token guidelines on Ethereum. This cross-compatibility empowers developers working on either network to integrate the stablecoin, resulting in users being able to make secure transactions between the two platforms.

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2024-04-04 18:00