[NEWS] Ripple to issue US dollar-pegged stablecoin to compete with Tether and Circle

On the 4th, Ripple announced that it will issue a stablecoin pegged to the US dollar. The stablecoin will be issued on the XRP Ledger (XRPL) and Ethereum (ETH), and is scheduled to be issued later this year.

Currently, the US dollar-linked stablecoin market is dominated by USDT by Tether and USD Coin (USDC) by Circle. Ripple will challenge the stablecoin market, which is currently worth $150 billion (approximately 22 trillion yen).

According to the announcement, the stablecoin issued by Ripple will always be backed one-to-one by the company's reserve assets of US dollar deposits, US Treasury bonds, and cash equivalents. The reserve will be listed in the monthly certification report, which is published every month. The third-party auditing company has not been disclosed at this time.

Ripple will first issue the stablecoin in the US, but as a future strategy, it plans to issue it in markets such as Europe and Asia. We will position Tether and Circle as rivals and focus on our business.

Ripple CEO Brad Garlinghouse said in an interview with CNBC that he "will not back down from competition." He also said that "the stablecoin market will be different depending on the size in the future."

According to him, Ripple decided to enter the stablecoin market in response to the temporary depegging of USDT and USDCoin. Garlinghouse said, "We felt a sense of mission and were convinced that we could issue and operate a safe and stable dollar-linked stablecoin."

He also said that there was "some uncertainty about the leader of the US stablecoin market," and although he did not name any specific names, he seemed to be criticizing the current situation surrounding the stablecoin field.

Complementing the XRP ecosystem

Garlinghouse emphasized that Ripple plans to expand XRP as a payment token in the future, and claimed that the stablecoin it plans to issue will "function as a complementary product (through the XRP ecosystem)." He also added that the stablecoin announced this time "will respond to requests from the community."

Ripple is currently in litigation with the SEC (U.S. Securities and Exchange Commission) over the issue of XRP securities. Some have said that this will be an obstacle to the issuance of a stablecoin.

Reference:Ripple announcement,CNBC interview
Image: Shutterstock

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