Ripple, the company behind XRP, is on the verge of launching its US dollar-pegged stablecoin, RLUSD. The upcoming release has excited Ripple’s community and the wider crypto space, with many expecting RLUSD to challenge Tether’s USDT and Circle’s USDC.
CTO Confirms RLUSD Won’t Be Retail-Focused
Ripple’s CTO, David Schwartz, confirmed that the stablecoin might not be directly accessible to retail users. Schwartz, responding to a comment on X, stated that RLUSD will likely follow a model where institutions have direct access, while retail users will need intermediaries like crypto exchanges to obtain it.
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This indirect approach seeks to reduce risks like money laundering but may disappoint retail investors who hoped for a more direct means of obtaining RLUSD.
The decision has sparked mixed reactions, with some retail users expressing frustration and others applauding Ripple’s focus on setting institutional standards.
Stablecoins Typically Cater to Institutions
The relationship between stablecoin issuers, institutions, and retail investors is a well-established process. Typically, issuers like Tether and Circle deal primarily with institutions such as banks and hedge funds. These institutions then distribute stablecoins in bulk to exchanges and platforms, where retail users can indirectly access them.
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Ripple appears to be following this trend, limiting direct access to RLUSD for institutional players. Retail users will likely need to acquire the stablecoin through exchanges and other channels that partner with Ripple.
Ripple’s Stablecoin Nears Launch
Ripple’s CEO, Brad Garlinghouse, recently announced that RLUSD is only weeks away from launch. The company first revealed its plan to enter the stablecoin market in April while the stablecoin is in its final testing phase. Moreover, trials are underway on both the Ripple and Ethereum blockchains. RLUSD aims to enhance the XRPL ecosystem and establish a foothold in the expanding stablecoin market, currently dominated by Tether.
Ripple also revealed an upgrade for XRPL, integrating smart contracts and Ethereum virtual machine compatibility to explore decentralized finance (DeFi) applications.
