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Ripple’s RLUSD Stablecoin: Why It Could Cost More Than $1 Initially
Ripple’s highly anticipated stablecoin, RLUSD, is set to launch in 2024, sparking immense excitement within the XRP community. As the release date draws near, expectations are running high, with many eager to get their hands on the new asset. However, Ripple’s Chief Technology Officer (CTO), David Schwartz, has issued a warning for potential buyers.
According to Schwartz, RLUSD may experience temporary price surges when it first becomes available. This is primarily due to an initial supply shortage. Some enthusiasts may be willing to pay more than $1 to be among the first owners of the stablecoin, which could lead to an inflationary effect on its value.
It’s essential to note that these price fluctuations are not indicative of the asset’s long-term potential. Schwartz emphasized that RLUSD is designed to maintain a consistent value of $1, and any deviations from this goal are likely caused by supply issues or short-term demand. He cautioned investors against buying into FOMO (fear of missing out), as the stablecoin’s primary function is not to generate profits but rather to provide a reliable store of value.
Despite the potential for early price volatility, Schwartz remains optimistic about the future prospects of the stablecoin market. Ripple views RLUSD as a credible participant in this space and anticipates significant growth. In fact, he predicts that the market could surpass $2 trillion by 2028.
In conclusion, while the launch of RLUSD may cause some short-term price fluctuations, its purpose is to maintain stability. Investors should exercise patience and avoid making impulsive decisions, as the value will stabilize once supply and demand reach an equilibrium.
Source: coinpedia.org
