Axelar Co-founder Says RLUSD Stablecoin Will Boost Demand for XRP

The XRP Community is eagerly awaiting the launch of the RLUSD stablecoin. The Ripple USD (RLUSD) is a stablecoin pegged to the US dollar, designed to maintain a stable value of one US dollar – keep that in mind, as we’ll come back to this shortly.

The RLUSD will be issued on both the XRP Ledger and Ethereum blockchains and Ripple says it will be “fully backed by a dedicated reserve of cash and equivalents, and redeemable on a 1:1 basis for US dollars”.

Georgios Vlachos, co-founder of Axelar, believes RLUSD will increase demand for XRP significantly. Speaking to Cointelegraph, Vlachos said that people in emerging economies (and others) use stablecoins as a store of value and medium of exchange.

Related: Solana’s Surge: New Developer Count Overtakes Ethereum, Signalling Rapid Growth

As RLUSD transactions will mainly settle on XRPL and the XRP-EVM sidechain this will increase the need for XRP.

When you do those transfers, you pay for gas in XRP. So, the XRP holders are still going to benefit because you burn some XRP every time you do a transaction.

Georgios Vlachos

In early 2024, Ripple announced a collaboration with Axelar Foundation to enhance the XRP Ledger’s interoperability with various blockchain networks.  

In November, RippleX, the developer’s account on X, said the XRPL EVM Sidechain would connect to over 80 blockchains and leverage the low fees on XRPL.

There are some wacky details emerging around the RLUSD launch. According to Ripple’s Chief Technology Officer David Schwartz, aka Joel Katz, people have been willing to fork over thousands of dollars for one stablecoin.

It should go without saying that stablecoins are…stable coins…and as such not meant to appreciate in value and by their very definition are not investments.

However, as Schwartz pointed out, “there may be supply shortages in the very early days before the market stabilizes”.

Which has led to some people wanting to spend ridiculous amounts on RLUSD.

There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD. Tools will show you the highest price anyone is willing to pay, even if it’s just for a tiny bit.

David Schwartz

Don’t FOMO Into RLUSD, Says CTO

The Ripple CTO said the price will ultimately stabilise close to US$1, indicating that paying thousands for the stablecoin is unwarranted.

If you want to spend a lot of money to get a tiny bit of RLUSD before anyone else does, you can. But please don’t expect the price to stay over $1 once things stabilize, which I expect they will do very quickly.

David Schwartz

Schwartz said that the “whole point of a stablecoin is to have a stable price”. And while fluctuations are to be expected, especially during the launch, they won’t last as “arbitragers rapidly fix the market”.

Related: AAVE, LINK, AVAX Spearhead Altcoin Rally amid Trump’s Crypto Buying

So, please, if you plan to make money with RLUSD, listen to David Schwartz:

Please don’t FOMO into a stablecoin! This is not an opportunity to get rich.

David Schwartz