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**Ripple’s Stablecoin Solution: Can RLUSD Trade at $1,200 on Debut?**
In a recent discussion, David Schwartz, Ripple’s Chief Technology Officer (CTO), shed light on the company’s new stablecoin, RLUSD. The comments raised important questions about how this newly minted stablecoin might trade on its debut.
According to Hartner, a community member and expert in crypto and blockchain, some stablecoins like USDC, which is controlled by Circle, are not always fully collateralized at all times. This means that under certain market conditions, the prices of these stablecoins can decouple from their pegged value of $1.
Hartner’s comment was made in reference to an incident where USDC depegged (lost its peg) over a weekend in March 2023 due to limited liquidity operations outside business hours. It highlights the importance of having continuous minting and burning capabilities, which are essential for maintaining the stability of a stablecoin.
**RLUSD’s Potential Debut Price**
When questioned about RLUSD’s potential debut price, Hartner emphasized that the peg is enforced by traders themselves. He explained that if more stablecoins are being sold than there are buyers willing to pay $1, the price on a particular exchange can slip until market participants or liquidity providers intervene.
While Ripple has not disclosed the exact launch date or price of RLUSD, it’s essential for investors and traders to understand the potential risks associated with decentralized stablecoin solutions. As Hartner noted, prices can decouple from the peg if minting and burning are limited due to external factors.
RLUSD might trade at $1,200 on debut considering these factors.
Source: bitcoinist.com
