A recent inquiry has surfaced regarding Ripple’s Stablecoin and its potential impact on the XRP ecosystem. The discussion was sparked by statements from Ripple executive Eric van Miltenburg, suggesting that the stablecoin could enhance the XRP Ledger (XRPL) rather than diminish it.
However, questions have arisen regarding the role of XRP holdings in Ripple’s stablecoin backing, prompting clarification from Ripple’s CTO, David Schwartz.
Eric van Miltenburg, Ripple’s SVP for Strategic Initiatives, recently commented on the upcoming Ripple stablecoin, hinting at its potential benefits for the XRP ecosystem. With Ripple historically utilizing XRP extensively for cross-border transactions, the emergence of a stablecoin could potentially impact the value of XRP.
On the flip side, Miltenburg addressed concerns about the stablecoin overshadowing XRP, emphasizing that its launch on XRPL would ultimately benefit the ecosystem.
Drawing parallels to stablecoins integrated into other blockchains like Polygon, he suggests that this move could increase the total value locked (TVL) on the XRP Ledger, thereby enhancing trust in the blockchain.
However, members of the XRP community remain skeptical and seek clarification on certain aspects. In response to Miltenburg’s remarks, prominent XRP community figure Crypto Eri sought clarification from Ripple’s CTO, David Schwartz, regarding the role of XRP holdings in the stablecoin’s backing.
Specifically, Eri questioned whether the XRP Ripple holds would be considered part of the “cash equivalent” backing the stablecoin.
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In response, Schwartz explained that there is currently no native mechanism to “lock up” assets on XRPL. He suggested that Miltenburg’s reference to stablecoins boosting activity on other blockchains was likely in the context of their impact on overall blockchain utility, rather than specific TVL comparisons.
Schwartz outlined potential functions for stablecoins on XRPL, including providing a means for individuals to hold funds without exposure to crypto volatility and serving as assets for automated market makers (AMMs). Additionally, he noted that stablecoins could enhance the usability and functionality of XRPL overall.
As the discussion continues, stakeholders in the XRP community await further developments in the evolving landscape of digital assets.
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