Ripple Chief Technology Officer (CTO) David Schwartz has urged potential investors to avoid panic buying the Ripple USD (RLUSD) stablecoin before its official launch.
In a Dec. 15 post on X (formerly Twitter), Schwartz warned of the possibility of an initial supply shortage, which could cause price fluctuations in dollar fixed assets.
This warning comes as RLUSD pre-launch offers reportedly reached 511 XRP (equivalent to $1,200). He noted that early buyers may pay a high price simply for the novelty of owning the first RLUSD token.
The CTO explained that some buyers may pay a premium for the perceived “honor” of securing the fastest trades on Ripple's decentralized exchange. Despite the hype, Schwartz reassured investors that the stablecoin's price will remain around $1, as expected from a well-functioning stable asset.
Schwartz said:
“If you want to spend a lot of money and get a little bit of RLUSD before everyone else, you can do that. But don’t expect the price to go above $1 once the situation stabilizes. We expect it to stabilize soon.”
Schwartz also emphasized that companies that pay excessive prices should not expect long-term profits. The main function of stablecoins is to maintain parity with fiat currencies such as the US dollar. He emphasized that RLUSD was not designed as a speculative asset and advised against making fear-driven purchases.
He added:
“Don't FOMO into stablecoins! This is not an opportunity to get rich.”
Ripple aims for RLUSD to complement its XRP token by powering institutional trading and cross-border payments. However, RLUSD will face stiff competition upon its debut, as the stablecoin market is already crowded with giants like Tether's USDT and Circle's USDC.
Last week, the New York State Department of Financial Services (NYDFS) approved Digital assets after unexpected delays in the application process. Later, Ripple CEO Brad Garlinghouse confirmed that the stablecoin is scheduled to be released at an undisclosed date.
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