Ripple to Prioritize Stablecoin Over XRP in Billion Dollar Transaction Market? CTO David Schwartz Explains

• Ripple will integrate its upcoming stablecoin into the billion-dollar transaction market, giving users a better experience, lower fees and faster settlement than existing options.
• However, according to Ripple CTO David Schwartz, this won’t wipe out XRP’s role in the ecosystem, as users who are best served by the crypto for payments and transfers will still have access.

Much has been made about Ripple’s upcoming stablecoin, which will be launched later this year on the XRP Ledger. Some say it will boost the price of XRP to over $10 as the ecosystem becomes a hub for the multi-trillion-dollar payments market, as Crypto News Flash reported. However, others are concerned that it could eat into the XRP market, and recently, Ripple’s Chief Technology Officer David Schwartz shared his thoughts on this.

The upcoming stablecoin will be pegged 1:1 with the US dollar and compete directly with Circle’s USDC and Tether’s USDT. However, Ripple expects its vast network and a decade’s experience to give the new token a leg up in the market.

But with the stablecoin set to target the payments and cross-border funds transfer markets, what happens to XRP? According to Schwartz, it doesn’t have to be one or the other.

Schwartz took to X to respond to concerns voiced by one XRP enthusiast about where the upcoming developments leave the token. “Is this basically Ripple now saying that for the US to International payments, we don’t need the XRP token anymore, and we won’t need it for converting USD into a recipient’s native currency?” he asked.

In his response, Schwartz noted that Ripple believes in the horses-for-courses approach, where not everything suits everyone the same way.

Will the Ripple Stablecoin Threaten XRP?

Schwartz noted that Ripple aims to get the payments market into the XRPL ecosystem where they can settle in XRP whenever it suits them best, but are free to diversify if their needs change. He stated:

The idea is to get people using payment software that *can* settle with XRP. Then there’s no reason for them not to settle with XRP where it works best. It would be kind of silly to try to get people to use a solution where it’s inferior.

He added that Ripple’s approach is that in cases where XRP is the best solution, “we don’t want any barriers to people using it and getting the best experience.” However, in instances where the crypto isn’t the best solution, Ripple wouldn’t want to force it on users who end up suffering from an inferior experience or worse economics.

Where XRP works best, we don’t want any barriers to people using it and getting the best experience. Where XRP does not work best, we don’t want people using it just to make us happy and suffering an inferior experience or worse economics. 2/2

— David “JoelKatz” Schwartz (@JoelKatz) April 24, 2024

With payments, it’s logical to assume that there’s no scenario under which XRP would be better than a stablecoin, especially when they both rely on the same XRP Ledger to process transactions. However, in response to a similar concern, Schwartz offered a different opinion, stating:

For cases where you don’t hold the intermediary asset for very long, the stablecoin doesn’t really have any inherent advantage. It will likely come down to issues like liquidity and availability of on/off ramps.

XRP trades at $0.524, gaining 5% over the past week amid sideways trading over the past two days.

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