Ripple Labs’ RLUSD stablecoin has been approved by the New York Department of Financial Services (NYDFS), according to CEO Brad Garlinghouse.
Ripple Labs’ RLUSD stablecoin has been approved by the New York Department of Financial Services (NYDFS),
according to CEO Brad Garlinghouse. He announced the regulatory greenlight on Dec. 10 and said exchange and partner listings for the stablecoin would be live soon. Ripple originally planned to launch RLUSD as a competitor to Tether’s USDT and Circle’s USDC, with the stablecoin pegged 1:1 to the U.S. dollar. It will be backed by USD deposits, short-term U.S. Treasury bonds, and other cash equivalents.
Ripple began testing RLUSD on the XRP Ledger and Ethereum mainnets in August, following its announcement in April. By October, the company had partnered with several exchanges, including Uphold, Bitstamp, Bitso, MoonPay, Independent Reserve, CoinMENA and Bullish, to facilitate the token's launch. Liquidity support will come from market makers such as B2C2 and Keyrock.
The approval process faced delays, as Ripple initially expected the NYDFS to finalize its decision by Dec. 4. Despite this, Garlinghouse reiterated Ripple’s commitment to adhering to New York’s stringent crypto regulations, which require a BitLicense or a limited-purpose trust company charter for firms offering services to residents in the state.
Ripple executives project a bold future for RLUSD, estimating the stablecoin could reach a $2 trillion market capitalization by 2028. President Monica Long has
described the stablecoin as complementary to Ripple’s existing XRP token, while Garlinghouse highlighted its focus on institutional clients. At a recent conference, Ripple’s CTO David Schwartz expressed optimism that RLUSD could launch before year’s end.
The stablecoin market currently stands at $192.8 billion, with Tether dominating at $141 billion. Competitors like PayPal’s PYUSD and Ethena’s USDe have adopted strategies such as incentive programs to grow their market share. Ethena’s USDe, for example, has gained traction with a market cap of $5.6 billion, driven by a 27% annual percentage yield. The sector remains competitive, and Ripple faces challenges in carving out space for RLUSD.
Ripple’s announcement comes during a busy period for the company. Garlinghouse recently
appeared on “60 Minutes” to discuss the role of cryptocurrencies in shaping the 2024 U.S. elections. Meanwhile, Ripple is still in a legal battle with the U.S. Securities and Exchange Commission (SEC) over the classification of XRP token offerings.
As Ripple prepares to launch RLUSD, the stablecoin is poised to enter a competitive market dominated by established players. With regulatory approval secured and strategic partnerships in place, the company is positioning RLUSD as a significant player in the evolving stablecoin ecosystem.
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