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Ripple’s Stablecoin: The ‘Death of $XRP’ or Its Perfect Companion?

Ripple’s Stablecoin: The ‘Death of $XRP’ or Its Perfect Companion?

In early April 2024, blockchain company Ripple (XRP) announced plans to launch a US dollar-pegged stablecoin to support the growth of its public blockchain XRP Ledger (XRPL).

While Ripple CEO Brad Garlinghouse called the stablecoin launch a “natural step for Ripple,” the company will find itself in an overcrowded yet lucrative $150 billion stablecoin market that is often in the crosshairs of lawmakers and regulators.

What does Ripple’s stablecoin mean for XRP? Will it rival Tether (USDT), USD Coin (USDC), and other key stablecoin market players?

Key Takeaways

  • Ripple will launch a stablecoin on the XRP Ledger and Ethereum.
  • Ripple aims to launch a “compliance-first” stablecoin aimed at institutional clients.
  • Critics fear that a Ripple stablecoin will make the XRP token obsolete.
  • Meanwhile, Anndy Lian, an intergovernmental blockchain expert, said Ripple’s dual-asset approach could improve the overall payment experience for customers.
  • Tether’s early-mover advantage has made USDT the most popular stablecoin in the world, accounting for 72% of stablecoins’ daily trade volume.

Why Is Ripple Launching a Stablecoin?

Stablecoins are unique digital assets that offer the best of traditional and decentralized finance (DeFi). Crypto investors use these fiat-pegged tokens to facilitate trade, provide liquidity for currency hedging, and protect their portfolio against crypto market volatility. Another area in which stablecoins have shown immense promise is international remittances and inflation hedging.

Therefore, it is no surprise that Ripple, a company that provides cross-border payment, custody, crypto liquidity, and central bank digital currency (CBDC) solutions, is entering the stablecoin market.

The company said:

“Ripple will leverage both XRP and the stablecoin in its payment solution to further improve the customer experience and serve as the first enterprise use-case of the asset at scale. There is demand from Ripple’s customers in emerging markets to enable stablecoin payouts.”

According to Ripple’s statement, the company will issue US dollar-pegged stablecoins that will be 100% backed by US dollar deposits, short-term US government treasuries, and other cash equivalents. The stablecoin will be available on XRP Ledger and Ethereum (ETH).

In order to catch up to market leaders Tether’s USDT and Circle’s USDC, Ripple is prioritizing the issuance of a “compliance-first” and trustworthy stablecoin. Having a compliant stablecoin will be key for Ripple to keep hold of its primary clientele composed of institutions and governments.

What Does a Ripple Stablecoin Mean for XRP?

A burning question on every XRP investor’s mind is whether the upcoming Ripple stablecoin will complement the XRP token or render it obsolete.

Some think the Ripple stablecoin will bring the “death of XRP.” At the moment, XRP is primarily used as a bridging asset to facilitate cross-border payments on the XRP Ledger. For example, when a user converts Turkish Lira (TRY) to USD, the XRP Ledger first converts TRY to XRP and then converts XRP to USD. XRP is the bridging currency as it is the native token and, therefore, the most liquid asset on the XRP Ledger.

Now, the entry of a Ripple stablecoin threatens XRP’s position as the bridging currency. Not only will a stablecoin offer a non-volatile alternative for currency swaps, but the compliance-first nature of the asset will help calm the nerves of Ripple’s risk-averse institutional clients.

Back in 2021, money transfer services company MoneyGram International canceled its partnership with Ripple after the US SEC labeled XRP as an “unregistered security.” The case that began in December 2020 is still ongoing as of April 9, 2024.

Contrary to the lingering pessimism, Anndy Lian, an intergovernmental blockchain expert, was optimistic about Ripple’s “dual-asset approach” to creating blockchain-based enterprise-grade solutions that financial institutions need.

Lian told Techopedia:

“Ripple’s approach to leveraging both XRP and its stablecoin could offer the best of both worlds: the speed and technology of XRP with the stability and reliability of a stablecoin. Ripple’s USD-backed stablecoin is designed to be used alongside XRP in Ripple Payments to support greater liquidity and enable global on/off ramps to service cross-border payments demand at scale. This dual-asset approach could improve the overall payment experience for customers worldwide.”

The expert believes that while XRP serves as a bridge currency facilitating quick conversions between different fiat currencies, the introduction of a stablecoin could provide a less volatile option for the actual store and transfer of value, which might be particularly appealing in emerging markets where there’s demand for stablecoin payouts.

“The combination of XRP and a stablecoin in Ripple’s ecosystem is aimed at enhancing the efficiency and stability of cross-border payments,” he said.

Lian added that some analysts expect a 17% increase in XRP price following the stablecoin launch. He said:

“This is based on early on-chain movements that suggest investors are positioning for a positive price impact. Long-term predictions for XRP’s price remain optimistic, with some analysts suggesting the formation of a pennant structure over the past four years, indicating potential for significant price movements.”

Will the New Ripple Stablecoin Rival Tether and USDC?

Ripple will find it an uphill task to overtake market leaders Tether and Circle in the stablecoin market.

Despite clashes with regulators, Tether’s USDT continues to dominate the stablecoin industry. As of April 9, 2024, USDT’s market cap stood at over $107 billion, accounting for more than 71% of the total stablecoin industry market cap, CoinMarketCap data showed.

Tether’s early-mover advantage has made USDT the most popular stablecoin in the world. At the time of writing, USDT accounted for 72% of stablecoin daily trade volume.

Meanwhile, Circle’s USDC, which launched in September 2018, has eaten into USDT’s market share over the years due to its branding as the safest stablecoin in the market.

Circle’s close affiliation with influential crypto companies like Coinbase has also helped the USDC brand. As of April 9, 2024, USDC was the second largest stablecoin with a market cap of $32.6 billion (21% of cumulative stablecoin industry market cap) and a 24-hour trade volume of $7.8 billion (8% of total stablecoin daily trade volume at the time of writing).

Furthermore, Ripple’s plans to launch its stablecoin on the Ethereum blockchain means that its stablecoin will have to compete with innovative DeFi products such as MakerDAO’s multi-collateralized stablecoin DAI, Frax Protocol’s algorithmic stablecoin FRAX and Ethena Labs’ synthetic dollar USDe.

Ripple will find competition in the compliance-first stablecoin space as well. In the same week as Ripple’s stablecoin launch announcement, Agora announced the launch of its fully collateralized stablecoin, the reserve fund of which will be managed by global investment powerhouse Van Eck.

 

The Bottom Line

If there is one crypto product that has a product-market fit, it is stablecoins. Ripple’s venture into stablecoin could mark a new chapter for the XRP community.

For too long, Ripple has been associated with its fight against the US SEC. Maybe a stablecoin launch will bring back the spotlight on its blockchain products.

Source: https://www.techopedia.com/is-ripple-stablecoin-launch-bearish-for-xrp

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
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XRP to USD forecast: Can Ripple price finally reverse long-term downward trend?

XRP to USD forecast: Can Ripple price finally reverse long-term downward trend?

Ripple is one of the most talked about coin.

– What has been affecting the Ripple coin price recently?

The on-going, never ending and changing lawsuit is one of the key uncertainties. SEC has a different angled strategy against Ripple through Wahi complaint. This added insider trading allegations against 2 other Coinbase employees and putting 9 other cryptocurrencies as securities. If the SEC wins the case, this would set a precedent and would cause more problems for the crypto industry as a whole.

This outcome for Ripple might affect their On-Demand Liquidity (ODL) service. And if U.S. banks are not going with the ODL plans, this will then weaken Ripple’s CBDC setup and investors will not be very happy.

– Where could the token be headed in the future

According to CoinMarketCap price prediction function, 1222 users voted and predicted that the price of XRP will be around $0.4905 by 30 September 2022. This is a 47.86% increase in the current price. I must say that the supporters are still considerably bullish on the coin and hope they can get out of the lawsuit quickly.

I am more realistic at this point. I hope to see more signed partnerships that are actually useful, not for PR purposes and see more real implementations in a larger manner, not purely news on how they help streamline Japan-Thailand money transfers. I hope to see more details. I am sure the investors at large want to see more too.

 

XRP to USD forecast: Can Ripple price finally reverse long-term downward trend?

 

Ripple (XRP/USD) is among the top 10 largest cryptocurrencies by market capitalisation. Dubbed a “better alternative to bitcoin”, Ripple aims to futurise global payments.

However, in recent years the company has been caught in the midst of a US Securities and Exchange Commission (SEC) filing, with its native cryptocurrency, XRP, struggling to reach past highs…for over four years.

Down by 90.3 % since its 2018 all-time high of $3.3778, at the time of writing (5 September) the XRP to USD exchange rate stood at $0.3275. Can the token repeat the record levels, and what is the latest news on the SEC case?

What is XRP/USD and Ripple?

Ripple was created in 2011 by engineers David Schwartz, Jed McCaleb and Arthur Britto. They began developing the XRP Ledger (XRPL),  a decentralised, permissionless, open-source, public blockchain.

The Ripple platform is a payment settlement system and currency exchange network using XRP Ledger Consensus Protocol. The network prides itself in its transaction speed, which according to its website, can take between three and five seconds and has low transaction fees that are “typically” under $0.01.

Ripple’s distributed consensus mechanism uses designated servers called validators, who have to agree on the order and outcome of transactions on the platform to enable them. Transactions are made in XRP coins, the platform’s native cryptocurrency.

The token can be sent to other users directly without the need of a central intermediary. XRP coins are freely exchanged on the open market and used in the real world for enabling cross-border payments and microtransactions.

Upon the token’s launch, XRPL’s founders gifted 80 billion XRP to the company. Ripple has since put the majority in escrow. As of August 2022, 44bn tokens remain in escrow.

 

What is your sentiment on XRP/USD?

XRP/USD price analysis

Unlike many of its rival cryptocurrencies that gained popularity in late 2021, XRP achieved its first success in the early months of 2018 as it was teaming up with a number of legacy financial institutions, like American Express and Santander. The token spiked to the all-time high of $3.3778 in January 2018, yet the rally was short-lived as XRP fell below $1 in late February. XRP to USD chart, September 2013 – September 2022

After two years of fluctuating between $0.60 and $0.10, the XRP coin price rebounded to $1.8391 on 14 April 2021 amid wider cryptocurrency bull run.

Throughout the remainder of 2021, the XRP to USD chart suffered fluctuations, rising as high as $1.3894 at the start of September 2021 and dropping as low as $0.7993 by mid-December.

At the start of 2022, XRP was holding steady at $0.80. It dropped to $0.30 as Russia’s invasion of Ukraine and surging inflation started to affect broader cryptocurrency sentiment. As of 5 September, the current exchange rate of XRP to USD stood at $0.3275.

 

SEC’s case against Ripple

In December 2020, Ripple found itself in the midst of a SEC filing, which accused the company’s top executives, co-founder Christian Larsen and CEO Bradley Garlinghouse, of misleading XRP investors by selling $1.3bn worth of coins without reporting to the commission. The SEC had also accused the executives of profiting from the trade by around $600m.

In March 2022, the court denied the SEC’s request to strike Ripple’s fair notice defence, which argued that contrary to the case, the company did not receive a fair warning that its sales of XRP coins could be in violation of security laws.

In July 2022, Ripple won a ruling that will allow the company to access emails from the SEC about a 2018 speech where a former official declared that Ethereum was not a security. The evidence could help Ripple in arguing that XRP cannot be labelled as such. The SEC, however, continued to battle this ruling and filed a brief arguing that the speech drafts “are not relevant to any claim or defense in this case”.

On 19 August, Ripple filed a motion to seal the identities of non-parties, some company employees and the personal financial information of employees. The SEC replied, clarifying that in doing so, it “does not concede that the above categories of information should properly be sealed for summary judgement briefing, and reserves its rights to oppose similar sealing requests for summary judgement.”

The judge granted the SEC’s request to file a 90-page long reply to its motion that seeks to exclude the testimony of Ripple Labs’ witnesses.

The outcome of the court proceedings could remain the key factor affecting the movements on the XRP chart. As of 5 September, analysts and investors await 9 September, when both parties are expected to seal any portion of the filings together with proposed redaction.

Responses to the motion must be submitted by 16 September. Motions for summary judgement are expected by 15 September,  and any opposition to that must be received by 18 October and answered by 15 November. The coming months will be of great importance for Ripple enthusiasts.

“The ongoing, never ending and changing lawsuit is one of the key uncertainties. SEC has a different angled strategy against Ripple through Wahi complaint. This added insider trading allegations against two other Coinbase employees and put nine other cryptocurrencies as securities,” said Anndy Lian, chief digital advisor of the Mongolian Productivity Organisation.
“If the SEC wins the case, this would set a precedent and would cause more problems for the crypto industry as a whole,” he told Capital.com.

On 21 July, the SEC filed a complaint against Ishan Wahi,  Coinbase’s manager in its assets and investing products division, and two other employees, accusing them of insider trading and securities fraud. In the filing, the commission noted that the nine coins Wahi and other defendants traded were “crypto asset securities”.

 

XRP to USD forecast for 2022 and beyond

Despite the latest downward price action, algorithm-based forecasting service Wallet Investor gave a bullish XRP to USD crypto exchange rate prediction as of 5 September. The site noted that XRP is “an outstanding long-term investment”, adding that it has a long-term earning potential amounting to 284.71%.

Based on its analysis of past price performance, Wallet Investor predicted that the token could trade at $0.517 in 2023 and reach $1.258 by 2027.

DigitalCoinPrice supported the positive XRP to USD future exchange rate forecast at the time of writing, expecting the token to grow to $0.48 by the end of 2022 and reach $1.50 by the end of 2025.

By the end of 2027, the site predicted that the exchange rate of XPR to USD could reach $1.63. The website’s long-term forecast for the token showed that the cryptocurrency could surge to $4.63 by 2030.

Mark Fidelman, founder of SmartBlocks, was bullish on XRP to USD exchange rate, yet noted that the outcome of the SEC case will play a crucial role in shaping Ripple’s future.

“If [Ripple wins] the lawsuit, it should be heading back up to over a buck by the end of year, maybe more…It’s more effective and more efficient than anything that the banks are doing, so it should scare the banks and should help crypto,” he told Capital.com.

Note that predictions about the future of XRP can be wrong. Forecasts and analyst expectations shouldn’t be used as a substitute for your own research. Always conduct your own due diligence looking at the latest news, price charts.  technical and fundamental analysis.

Remember that past performance does not guarantee future returns. And never trade money that you cannot afford to lose.

 

Source: https://capital.com/xrp-usd-forecast-dollar-ripple-price

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Ripple Bets On the New SEC While the XRP Purge Continues

Ripple Bets On the New SEC While the XRP Purge Continues

It looks like major US-based blockchain company Ripple is putting their hopes in the new US Securities and Exchange Commission (SEC) following a lawsuit filed against the company by the regulator. Meanwhile, more platforms are suspending trading in XRP.(Updated at 16:08 UTC: updates in bold.)

Ripple is now looking towards the incoming new SEC leadership, which may (or may not) be more friendly towards it and XRP. “[W]e also look forward to working with all of the Commissioners and the SEC’s new leadership, once appointed,” they said in their December 29 announcement.

They added that “in all, the SEC Chair, six of his Directors from each SEC Division, the SEC’s Chief Economist and the SEC’s General Counsel have now departed (many left just last week),” and added that their “steadfast commitment to constructive regulatory engagement has not changed.” (Learn more: Cryptoverse Might Face ‘More Aggressive’ SEC Under Biden)

As reported, Ripple is questioning the motivation for bringing this action against them just days before the change in administration because “the SEC has permitted XRP to function as a currency for over eight years.”

Meanwhile, among the latest announcements regarding the staff change on the SEC’s website is the one that Sean Memon will conclude his tenure as the agency’s Chief of Staff in January 2021. Memon served as principal advisor to Chairman Jay Clayton on legal, policy and management matters, it said. It was announced in November that Clayton himself would leave by the end of this year, and just yesterday it was confirmed that Donald Trump designated Elad L. Roisman as Acting Chairman of the agency, who is generally said to be crypto-friendly.

Calling the lawsuit an attack on the entire crypto industry in the US that brought more uncertainty to the market and harm to the community the SEC is supposed to be protecting, Ripple said the lawsuit “affected countless innocent XRP retail holders with no connection to Ripple.”

Following the news, XRP erased almost all its gains over the past 12 months.

The company added that Ripple will continue operating in the US and globally, that the majority of their customers aren’t in the US, and that overall XRP volume is largely traded outside of that country.

An initial pretrial conference in the lawsuit has been set for February 22, according to a court order.

Meanwhile, exchanges continue their ‘evictions’ of XRP, so to say. Following several minor exchanges, as well as major ones like Coinbase and Bitstamp, Bittrex said it would be removing four available XRP markets (around USD 20m in combined trading volume in the past 24 hours, per Coinpaprika.com data) on January 15.

“Until further notice, customers will continue to have access to their XRP wallet on Bittrex after the markets are removed,” they added.

Also, Swipe Wallet will delist XRP for the USA users on January 5. Crypto buying app Ziglu will suspend XRP trading on January 12 and digital payment services provider Wirex decided against including XRP in a US version of the app slated for launch in January, The Block reported.

Meanwhile, in their latest report, Arcane Research predicted that XRP will drop out of the top 10 coins by market capitalization in 2021. “XRP has experienced terrible volatility lately with the SEC charges against Ripple, leaving late investors with big losses. XRP is about the erase all gains of 2020,” it said.

XRP has already dropped from the third position as the largest cryptoasset by market capitalization to the fourth following the crackdown.

At pixel time (10:23 UTC), XRP trades at USD 0.21 and is down by 4.6% in a day and 38% in a week. The price crashed by 66% in a month, erasing its gains over the past 12 months to less than 9%.

XRP price chart:

Ripple Bets On the New SEC While the XRP Purge Continues 102
Source: coinpaprika.com

Original Source: https://cryptonews.com/news/ripple-bets-on-the-new-sec-while-the-xrp-purge-continues-8764.htm

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j