Ripple President Monica Long explains the value of RLUSD alongside XRP – Times Tabloid

In a recent interview on The Scoop podcast, Ripple President Monica Long discussed the rationale behind the creation of the RLUSD stablecoin, especially given XRP’s established role in facilitating cross-border transactions.

Long emphasized that XRP and RLUSD serve complementary purposes and meet the different needs of payment providers and developers within the Ripple ecosystem.

RLUSD: A tailor-made solution for payment service providers

For payment service providers, RLUSD offers a low-cost alternative for certain transactions. For a long time, scenarios have been highlighted where established currency pairs such as USD/EUR have sufficient market liquidity. In such cases, the use of XRP as a bridging asset might be unnecessary.

In addition, Ripple recognizes the vision of XRP Ledger (XRPL) resource consumers who view XRP as a neutral settlement mechanism for various tokenized assets. This is consistent with Ripple’s long-standing advocacy of XRP as a bridge asset for the future “Internet of Value” where various assets exist on the blockchain.

However, Long stresses the continued importance of XRP for efficient cross-border settlements, especially for transactions involving less widely used currencies or those with insufficient liquidity. In regions such as sub-Saharan Africa, Europe and the Middle East, transaction fees can exceed 10% due to these factors. In such scenarios, the role of XRP in enabling low-cost settlements becomes crucial.

Empowering developers with RLUSD

For developers, RLUSD fills a different need. Traditionally, the US dollar has served as the primary entry point for the cryptocurrency industry and a starting point for acquiring other cryptocurrencies or tokenized assets.

Long recognizes the immense potential of XRPL’s decentralized exchange (DEX) and acknowledges the need for high-quality stablecoins to increase appeal to developers. This focus on DeFi (Decentralized Finance) is in line with Ripple’s strategy, with USD stablecoins envisioned as the cornerstone of this ecosystem.

Why RLUSD Complements XRP: A Community Perspective

The recent discourse about the complementary role of RLUSD to XRP has generated great interest in the XRP community. Vet, a dUNL validator for XRPL, offered valuable insights during the interview and emphasizes that the introduction of RLUSD should strengthen the utility of XRP and not diminish it.

Previous interviews with other Ripple executives, including CTO David Schwartz, have also confirmed this opinion. They have consistently emphasized that the upcoming stablecoin will expand the functionalities of XRP within the RippleNet network.

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With the launch of RLUSD, Ripple is strategically expanding its toolkit to meet the evolving needs of its customer base. While XRP continues to be a staple solution for efficient cross-border settlements, especially for transactions involving less widely used currencies, RLUSD offers a low-cost alternative for transactions involving major currency pairs with sufficient liquidity.