Why Ripple’s RLUSD stablecoin thrives on Ethereum over XRPL

Ripple’s RLUSD stablecoin is rapidly expanding on Ethereum rather than the company’s native XRP Ledger (XRPL).

According to CryptoSlate data, RLUSD’s total circulating supply has surged to $1.26 billion within 12 months of its launch. Of this, roughly $1.03 billion, or 82% of the total supply, resides on Ethereum, while the $235 million balance is on XRPL.

These numbers show that the market seems to favor the deep liquidity and composability of the Ethereum Virtual Machine over the more compliance-focused architecture of the XRPL.

Why RLUSD is growing on Ethereum

The primary driver of this disparity is the maturity of the underlying financial stack.

On Ethereum, RLUSD entered an environment where dollar liquidity is already entrenched. Data from DeFiLlama confirms that Ethereum continues to lead all chains in total value locked (TVL) and stablecoin supply, providing a turnkey ecosystem for new assets.

So, any new stablecoin that can plug into major DeFi protocols like Aave, Curve, and Uniswap immediately benefits from existing routing engines, collateral frameworks, and risk models.

RLUSD’s presence on Aave and Curve confirms this. The USDC/RLUSD pool on Curve now holds approximately $74 million in liquidity, ranking it among the larger stablecoin pools on the platform.

For institutional treasuries, market makers, and arbitrage desks, this depth is non-negotiable. It ensures low-slippage execution for trades in the tens of millions, facilitating basis trades and yield-farming strategies that drive modern crypto capital markets.

On the other hand, the XRPL is still in the nascent stages of building a DeFi foundation. Its protocol-level automated market maker (AMM) went live only in 2024. So all RLUSD-related pools on the ledger, such as the USD/RLUSD pair created in January 2025, still suffer from shallow depth and limited follow-through.

Moreover, the XRPL AMM design has not yet attracted the liquidity provider density seen in EVM ecosystems.

Consequently, a dollar of RLUSD placed on XRPL presently finds far fewer venues for swaps, leverage, or yield than the same dollar deployed on Ethereum.

RLUSD’s growing user base on Ethereum

Critics might argue that RLUSD’s Ethereum supply is merely “vanity metrics,” large sums minted but sitting idle.

However, a deeper analysis of on-chain transfer data refutes this. RLUSD is showing a genuine product-market fit with Ethereum, characterized by high velocity and recurring usage.

According to Token Terminal, weekly RLUSD transfer volume on Ethereum now averages approximately $1.0 billion, a dramatic increase from the $66 million average seen at the start of the year.

The data shows an apparent structural shift of a steady upward trend through the first half of 2025, followed by a “re-basing” to a significantly higher floor in the second half.

Crucially, recent weeks show activity clustering around this elevated level rather than spiking and reverting. In market structure terms, a rising baseline typically signals a transition from a distribution phase to a utility phase.

This implies that the token is being used in ongoing, recurring flows, such as institutional settlement and commercial payments, rather than isolated speculative events.

Transfer counts support this thesis. Weekly transactions on Ethereum now average 7,000, up from 240 in January.

The fact that transfer counts are rising in parallel with volume is a critical health indicator. If volume were rising while counts remained flat, it would suggest a market dominated by a few whales moving massive sums. Instead, the concurrent rise points to broader participation.

Furthermore, the holder data suggest a healthy dispersion of risk. According to data from Etherscan, Ripple’s RLUSD has attracted roughly 6,400 on-chain holders on Ethereum as of late November 2025, up from just 750 at the start of the year.

While the supply growth has been driven by “chunky” batch issuances rather than drip minting, the holder count has followed a smooth upward curve.

The friction between RLUSD and XRPL

The structural divergence between the two networks explains why the “permissionless” growth loop has favored Ethereum.

On Ethereum, RLUSD functions as a standard ERC-20 token. Wallets, custodians, accounting middleware, and DeFi aggregators are already optimized for this standard.

Once a protocol like Curve “wires in” a token, it becomes part of the standard dollar-pair universe alongside USDC and USDT, accessible to any address without prior authorization.

On the other hand, XRPL’s design choices, while technically robust, impose significantly higher friction on the user.

To hold RLUSD on the native ledger, users generally must maintain an XRP balance to satisfy reserve requirements and configure a specific trustline to the issuer. If the issuer enables the `RequireAuth` setting, which is a feature designed for strict compliance and granular control, accounts must be explicitly allow-listed before they can receive tokens.

So, while Ripple notes that these features appeal to banks that require explicit control, they act as a brake on organic adoption.

Essentially, the compliance tools that make XRPL attractive to regulated entities are the same features that slow down wallet-to-wallet distribution.

In a market where capital seeks the path of least resistance, the operational burden of trustlines renders XRPL less competitive for the high-frequency, automated flows that define DeFi.

RLUSD’s path to growth

Despite the ledger imbalance, the overall trajectory of RLUSD puts Ripple within striking distance of a major market tier.

Token Terminal has stated that Ripple would cement itself as the third-largest stablecoin issuer globally, behind only the incumbents Tether and Circle, if RLLUSD’s market cap were to grow 10x from current levels.

Considering this, RLUSD’s growth depends heavily on whether Ripple can leverage its Ethereum success to eventually jumpstart its native chain.

A base-case projection for the next six months sees RLUSD’s Ethereum supply climb from roughly $1.0 billion to a range of $1.4 billion to $1.7 billion. This assumes that Curve liquidity remains in the $60 million to $100 million band and that CEX and OTC demand continues to grow.

Under this path, XRPL would likely see its pools accumulate more liquidity over time but remain a small fraction of the aggregate issuance.

Meanwhile, a more aggressive “catch-up” scenario for XRPL would require deliberate market intervention. If Ripple or its partners commit to multi-month AMM reward programs and successfully mask trustline configurations behind single-click wallet interfaces, the native ledger could begin to erode Ethereum’s lead.

With these levers, XRPL liquidity could plausibly reach $500 million and claim up to 25% of the total supply.

However, the downside risk for the native ledger is real. If Ethereum cements its lead and the Curve USDC/RLUSD pool expands beyond $150 million, the network effects may become insurmountable. In that scenario, Ethereum could retain 80% to 90% of the supply indefinitely.

For now, Ripple finds itself in a paradoxical position: to succeed in its ambition to become a top-tier stablecoin issuer, it must rely on the infrastructure of its biggest rival.