Ripple and Stablecoin Strategy: Opportunities and Risks for XRP Investors

The year 2025 is witnessing a strong explosion of stablecoins. The total market capitalization of stablecoins has surpassed the 280 billion USD mark, led by Tether (USDT) and USD Coin (USDC). Notably, the United States passed the Genius Act last month – an important legal framework regulating stablecoins. In this context, many large financial institutions are considering issuing their own stablecoins, and Ripple is one of the blockchain companies making the boldest moves. If you are an XRP investor, Ripple's recent actions regarding stablecoins are particularly noteworthy.

1. Ripple officially launches the first stablecoin In December 2024, Ripple received a license from the New York Department of Financial Services (NYDFS) to issue the first stablecoin – Ripple USD (RLUSD). This is a stablecoin fully backed by cash and cash-equivalent assets. CEO Brad Garlinghouse stated that Ripple chose the legal framework in New York for its transparency and credibility. As a result, RLUSD quickly complied with the reserve and audit standards under the Genius Act. RLUSD plays an important role in Ripple's global payment network, helping customers transfer and receive digital dollars quickly and at low cost. However, the market capitalization of RLUSD has currently reached only about 670 million USD ( as of 16/8/2025), meaning there is still a lot of room for growth.
2. Strategic partnership with Circle – the issuer of USDC On June 12, 2025, Ripple and Circle – the company behind the issuance of the USDC stablecoin – announced a partnership to integrate USDC into the XRP Ledger (XRPL), the core blockchain of Ripple. This integration promises to bring abundant liquidity and attract more developers to XRPL. With a market capitalization of over 68 billion USD, USDC is more than 100 times larger than RLUSD, and bringing USDC to XRPL will make this network more appealing to businesses and investors.
3. Acquisition of the stablecoin payment platform Rail On August 7, 2025, Ripple continues to expand the power of stablecoins by acquiring Rail – a stablecoin payment platform – for $200 million. Rail allows businesses to transfer money internationally using stablecoins without the need to directly hold cryptocurrencies. This platform supports the conversion of fiat currency to stablecoins and vice versa, facilitating quick payments and cost savings. According to the report, Rail currently accounts for over 10% of the total B2B stablecoin volume globally, equivalent to 36 billion USD in annual transactions. This is a strategic move that complements Ripple's long-term goal of expanding the payment infrastructure for businesses.
4. Will stablecoins reduce the role of XRP? XRP serves as the native currency on XRPL, used to pay transaction fees and is the bridge currency in Ripple's On-Demand Liquidity (ODL) service. With ODL, XRP allows financial institutions to instantly convert currencies without needing to hold multiple foreign currencies. However, the emergence of stablecoins - especially RLUSD - raises an important question: Will stablecoins replace the bridging role of XRP? Positive: The stablecoin (RLUSD, USDC) will attract more transactions and liquidity on XRPL. Each transaction requires a small amount of XRP to pay the fee, which still creates demand for XRP. Negative: The transaction fee on XRPL is very small (0.00001 XRP). The true value of XRP lies in its role as a bridge in cross-border payments. If RLUSD performs this role well, the demand for XRP may decrease. Nevertheless, Ripple still holds nearly 50% of the XRP supply, so the company has a clear interest in maintaining the core role of this token. It is highly likely that XRP and RLUSD will coexist in parallel: XRP continues to act as a bridge between different currencies. RLUSD is used when both parties in a transaction wish to maintain value in USD.
5. Conclusion for XRP investors Recent steps indicate that Ripple is building a payment ecosystem that combines XRP and stablecoins. This could be a long-term growth driver for both assets, while also helping Ripple become a major competitor in the global payment space. However, XRP is still a high-risk coin with strong volatility. Investors should only allocate a small portion of their portfolio, rather than betting their entire capital. In summary: Stablecoins present both opportunities and challenges for XRP, but if Ripple succeeds in balancing these two factors, XRP could benefit net from the stablecoin boom in the coming years.