XRP use grows as RLUSD stablecoin expands to 40 blockchains

A new debate has taken center stage within the XRP Ledger (XRPL) community, reigniting discussion on the changing relationship between stablecoins, payment systems, and XRP itself. As the decentralized finance footprint of the XRPL expands, and tokenization as well as cross-border payments gain traction, developers and researchers are re-examining XRP’s evolving role across these interconnected systems.

Stablecoins increasingly drive payment flows

The conversation began after XRPL researcher Eri highlighted that Ripple’s On-Demand Liquidity (ODL) payment flows now frequently utilize major stablecoins such as Tether and USD Coin. According to Eri, while stablecoins have become a more prominent part of the payments infrastructure, liquidity provided on the XRPL remains one of its core elements.

Eri also pointed out that the use case for XRP isn’t confined to payments alone. She argued that the digital asset can also serve as collateral in a variety of financial applications, suggesting XRPL-based decentralized finance products could see XRP play a broader, more foundational role.

Some see XRP and stablecoins as complementary

The debate picked up speed following comments from Vet, a contributor to the XRPL Foundation and a dUNL validator, who asserted that XRP and stablecoins are not competitors—they’re designed to complement one another.

According to Vet, a stablecoin-dominated payment model resembles standard payment flows more than traditional cross-currency transfers, since conversions can take place at both the sending and receiving ends, potentially eliminating the need for additional swaps on XRPL’s decentralized exchange.

Nonetheless, Vet cautioned that robust payment networks still depend on strong assets and stablecoin-based liquidity for efficient transactions. He emphasized that as more issued assets enter the XRPL ecosystem, the need for a shared bridge asset will remain critical.

Mini glossary: dUNL refers to the ‘dynamic Unique Node List’, a set of validators recognized as trustworthy on XRPL. This list determines which validators can reach consensus on network transactions.

Bridge asset efficiency remains a focus

Vet further explained that without a common bridge asset, liquidity could become fragmented across numerous trading pairs, lowering efficiency. In his view, situations that call for bridging between various assets are precisely where XRP is positioned to excel.

He also argued that bridge assets within decentralized networks should be as neutral as possible, avoiding reliance on a single issuer. This approach lies at the heart of current XRPL debates about which asset should be the primary means for value transfer on the network.

Ripple’s stablecoin strategy and XRPL’s growth

This renewed debate follows Ripple’s ongoing strategy to scale up its stablecoin operations. The company’s RLUSD stablecoin has recently expanded to 40 separate blockchain networks, broadening access to payment solutions, institutional liquidity, and tokenized assets.

Meanwhile, use cases for the XRPL have evolved well beyond payments alone. Tokenization, lending, and decentralized finance now rank among its core features, and recent proposals to add StableSwap and concentrated liquidity to the automated market maker infrastructure are expected to significantly increase price efficiency for stablecoins and real-world assets alike.

There remains no consensus in the XRPL community over whether increased stablecoin activity might lessen demand for XRP. However, the latest round of discussion underscores a growing view among XRPL developers that XRP and stablecoins are taking on distinct, complementary functions within a maturing financial ecosystem.

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