As the stablecoin market is growing, this segment is expected to reach $3 trillion by 2028, according to Ripple. Legal issues aside, including some scrutiny from the Securities and Exchange Commission (SEC), Ripple plans to introduce its stablecoin in June, as reported.

Ripple’s Stablecoin Launch and Market Forecast

During the XRP Las Vegas conference, Ripple’s CTO, David Schwartz, teased about the chance that the company’s stablecoin will be launched in June, leaving the market eager and wanting for the date.

It is estimated that the stablecoin market could reach $3T by 2028.

Understand the role stablecoins play in the financial markets and learn about their use cases and how they push financial services innovation. https://t.co/F9zxkNVMnw

— Ripple (@Ripple) May 8, 2024

The stablecoin, backed by U.S. dollar deposits, government bonds, and cash equivalents, aims to offer stability and security with a 1:1 peg to the U.S. dollar. Such an initiative coincides with Ripple’s anticipation that by 2028, the stablecoin market value will be approximately $3 trillion since consumers currently need quick and secure digital assets solutions.

Ripple sees its stablecoin as providing new chances, especially in linking conventional financial systems with a growing crypto industry.

Schwartz hinted that the rest of the information would be unveiled at the XRPL Apex event in Amsterdam around the middle of June. The stablecoin is built to make use of the strengths of the XRP Ledger in decentralized exchange and automated market making, hitting institutional and DeFi applications.

SEC Scrutiny and Ripple’s Response

Although the ambitious stablecoin launch of Ripple has created excitement in the market, it will face substantial regulatory challenges. In a recent court filing, the SEC argued that Ripple’s intended stablecoin would be an “unregistered crypto asset. ”

The commission sought a permanent injunction against Ripple to stop it from unduly conducting further unregistered activities, contending that Ripple has historically engaged in unregistered institutional sales of XRP. The SEC also questioned Ripple for allegedly evading US security laws while it was licensed in other jurisdictions.

Ripple’s legal team rejected the SEC’s assertions by pointing out that compliance with international jurisdictions shows their adherence to regulations. The Chief Legal Officer of Ripple, Stuart Alderoty, was optimistic that a positive outcome of their issue with the SEC would come soon. He condemned the enforcement approach of the commission, stating that Ripple is closer to settling the case than ever.

Stablecoin Market Context

The stablecoin forecasts of Ripple are consistent with the general trend in the stablecoin market as a significant link between traditional finance and digital assets. Fiat-backed or commodity-backed stablecoins have got the stability as we.ll as faster processing times and are mainly used for international payments, remittances, and cryptocurrency trading pairs.

They further back decentralized finance (DeFi) applications that facilitate lending, borrowing and yield farming while ensuring stable value.

Fiat-collateralized stablecoins, such as USDC and Tether (USDT), are currently the most popular, offering reliability through their reserve backing. Meanwhile, crypto-collateralized stablecoins like DAI provide further integration with DeFi protocols. Algorithmic stablecoins, though riskier, offer innovative approaches to monetary policy and scalability.

Meanwhile, the XRP price has been in a downtrend in the last 24 hours after failing to breach the $0.5293 resistance. The bearish trend dipped the price to a low of $0.5162, where support was established. At press time, the XRP price was exchanging hands at $0.5163, a 2.45% decline in the last 24 hours.

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Filed under: News - @ January 1, 1970 12:00 am