Ripple’s CTO, David Schwartz, has issued a caution to potential investors, urging them to avoid panic-driven purchases of the Ripple USD (RLUSD) stablecoin ahead of its official release. In a post on Dec. 15 via X (formerly Twitter), Schwartz highlighted the risks of price fluctuations due to an initial supply shortage.
Pre-launch Hype and Inflated Prices
Schwartz’s warning comes as pre-launch offers for RLUSD have reportedly reached as high as 511 XRP, approximately $1,200. He noted that early buyers might overpay simply for the novelty of owning the first RLUSD tokens. This rush to buy could lead to inflated prices.
The “Honor” of Early Purchases
Some investors are willing to pay a premium for the perceived “honor” of securing the first RLUSD trades on Ripple’s decentralized exchange. However, Schwartz reassured them that the stablecoin’s price would stabilize near $1 once the market adjusts.
Avoid Speculation and FOMO
Schwartz emphasized that RLUSD is not a speculative asset. He cautioned against fear-driven purchases, as stablecoins are designed to maintain parity with fiat currencies, such as the US dollar.
He urged:
“Please don’t FOMO into a stablecoin! This is not an opportunity to get rich.”
RLUSD’s Role and Market Competition
Ripple intends RLUSD to complement its XRP token by enhancing institutional transactions and cross-border payments. However, the stablecoin market is already dominated by major players like Tether’s USDT and Circle’s USDC, making RLUSD’s market entry highly competitive.
Regulatory Approval and Launch Date
The New York State Department of Financial Services (NYDFS) approved RLUSD last week, after delays in the application process. Ripple CEO Brad Garlinghouse confirmed that RLUSD is on track for release, although the exact date remains undisclosed.
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