Ripple Labs' new stablecoin Ripple USD (RLUSD) is expected to receive approval from the New York Department of Financial Services (NYDFS) and could be ready for launch by December 4, Fox Business has knowledge of the matter. This was reported based on a person involved.
If Ripple Labs receives approval, it will be able to legally offer RLUSD (an overcollateralized dollar-pegged stablecoin).
The launch of RLUSD comes at a time when Ripple is embroiled in a battle with the U.S. Securities and Exchange Commission (SEC) to prove that XRP is not an unregistered security. The case is currently on appeal in the Second Circuit, but could be dismissed if SEC Chairman Gary Gensler resigns and Donald Trump takes control of the White House in January. .
In the meantime, Ripple's RLUSD will be a stable alternative that is less volatile like XRP.
In the absence of federal stablecoin regulation, operating under state-level regulation is the best approach for companies considering stablecoin offerings. Ripple could obtain a limited purpose trust charter like Paxos or Gemini, or launch RLUSD through a BitLicense, which allows crypto exchanges to facilitate the trading and storage of cryptocurrencies.
Ripple first announced plans to launch RLUSD in April. In June, Ripple acquired Standard Custody and Trust Company, a limited purpose trust company licensed by the NYDFS. Standard Custody has already obtained a license from NYDFS to provide crypto asset custody services and will become the issuer of RLUSD once NYDFS gives the green light to the stablecoin.
In August, Ripple began beta testing RLUSD on the XRP ledger and Ethereum mainnet. At the time, the company also announced plans to expand its stablecoin to other blockchains. Ripple said in a statement:
“There is a clear demand for a stablecoin that provides trust, stability, and utility. Once RLUSD is available, Ripple will use both RLUSD and of customers and dramatically improve their experience.”
In October, Ripple announced that it had partnered with top exchanges to make RLUSD available to users. This includes Uphold, Bitstamp, Bitso, MoonPay, Independent Reserve, CoinMENA, and Bullish.
Ripple will conduct regular third-party audits of the reserves supporting RLUSD and will issue monthly reports.
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