In order to compete with Tether and Circle in the $150 billion stablecoin industry, Ripple will introduce a new stablecoin based on the US dollar.
With a combination of US dollar assets, Ripple will keep them as reserves, such as deposits, government bonds, and cash equivalents, and the new stablecoin will retain a one-to-one value.
The corporation intends to publish monthly attestation reports regarding its reserves to maintain openness, however, the auditing firm has not yet been named.
Although its stablecoin is only now accessible in the United States, Ripple says it will soon be available in other countries as well as possibly localized versions for the European and Asian markets.
In a recent interview with CNBC, Brad Garlinghouse, the CEO of Ripple, stated that the company decided to introduce its stablecoin in response to the stability problems of the USDT and USDC coins.
Notably, USDT’s value dropped below $1 after the terraUSD collapse in 2022; USDC had a similar decline in 2023 following the impact of Silicon Valley Bank’s bankruptcy.
While Tether has been under fire for the real support of its reserves, Ripple wants to set itself apart by emphasizing that it is licensed and compliant with regulations in several places, such as Singapore, New York, and Ireland.
Garlinghouse drew attention to the regulatory ambiguities surrounding the market leaders today, highlighting Ripple’s regulated position as a key differentiator in the stablecoin space.
