Outside Source
One trader has set a $1,200 bid for one RLUSD, an early warning sign there could be massive volatility when Ripple’s RLUSD stablecoin launches.
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Ripple’s chief technology officer, David Schwartz, says there could be potential “supply shortages” in the early days of Ripple’s US Dollar-pegged stablecoin but is warning investors not to “FOMO.”
In a Dec. 15 post to X, Schwartz said he expects outsized volatility for RippleUSD (RLUSD) stablecoin immediately following its launch, with several large orders for the token despite being designed to maintain a 1:1 parity with the US dollar.
He noted that some small initial pre-market bids for the currently unreleased stablecoin were artificially inflating its value before its launch — responding to a post on X, which showed 1 RLUSD being valued at roughly 511 XRP (XRP) — worth $1,244 at current prices — on a Ripple wallet called Xaman.
“There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD,” said Schwartz.
Source: Amelie
Schwartz said that the bid looked as though someone wanted “the honor” of buying the first bit of RLUSD to go to market.
“But rest assured, the price will come back to very close to $1 as soon as supply stabilizes. If it doesn’t, something is very seriously wrong,” he said.
“Please don’t FOMO into a stablecoin! This is not an opportunity to get rich.”
On Dec. 11, Ripple CEO Brad Garlinghouse announced that RLUSD had received its final approval from the New York Department of Financial Services, with the official Ripple account on X saying that the stablecoin would be launching “soon.”
Source: Ripple
Related: Ripple’s RLUSD stablecoin: Here’s what you need to know before launch
Once RLUSD is available, Ripple plans to use both RLUSD and XRP in its cross-border payments solution to serve its global customers, the company said in RLUSD’s beta testing announcement.
In June, Ripple president Monica Long also said that RLUSD was built to be “complementary and additive” to XRP.
According to some sources, Ripple sees RLUSD as “beneficial” for XRP as RLUSD and XRP will be paired with each other.
While XRP will help add liquidity to RLUSD with its significant availability on exchanges, the stablecoin’s price will also be stabilized by pairing to prevent depegging.
According to Ripple Labs CEO Brad Garlinghouse, RLUSD will focus primarily on large institutional players.
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This article first appeared at Cointelegraph.com News
