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Ripple, XRP Ledger (XRPL) and Ethereum Blockchain announced plans to launch a US dollar-backed stablecoin. This move has ignited discussions on how it could potentially benefit XRP’s price. But will this move truly be beneficial for the price of XRP?
Implications of the Stablecoin Move
Ripple‘s decision comes amidst an ongoing legal battle with the SEC and the threat of significant fines. Ripple CEO Brad Garlinghouse remains optimistic about the launch, while market analysts and XRP investors are cautiously evaluating the outcomes.
The introduction of a Ripple-backed stablecoin could provide much-needed fuel for the XRP Ledger’s DeFi ecosystem. Although the network’s decentralized finance (DeFi) activities currently lag behind other chains, it does have a decentralized exchange. Ripple CTO David Schwartz believes the stablecoin could change the game for growth in this sector.
How Will XRP Be Affected?
The main question, however, focuses on how the stablecoin will directly affect XRP. Despite some positive court rulings last year that recognized XRP as a commodity, its price performance has remained relatively stagnant. Ripple hopes the stablecoin will increase XRP’s utility and liquidity, ultimately boosting its value.
Ripple’s stablecoin launch led to an immediate 10% increase in XRP’s price. However, XRP is currently trading at $0.58, with a 2.92% decrease over the last 24 hours. Analysts will closely monitor XRP’s performance to determine the impact of the upcoming development.
XRP Community Debates the Issue
Ripple’s decision to launch a stablecoin while facing significant legal and financial pressures has raised questions within the XRP community. Some speculate that this could be a move to strengthen the company’s financial resources against potential SEC penalties. Others wonder if it signifies a change in Ripple’s overall strategy for the future of XRP.
Blockchain Maverick commented on the development, saying, “Scary for XRP holders. I agree it makes sense, but this token will replace XRP’s use cases, then what’s the point of XRP? Things are going from bad to worse.”
We will see if Ripple’s stablecoin launch will indeed be a turning point for XRP. Market participants will need to carefully observe how XRP’s utility, liquidity, and investor sentiment evolve in response to this new product. However, I personally don’t think Ripple’s move will have a positive reflection on XRP. In fact, why even launch a stablecoin? XRP has been acting like a stablecoin for years.
