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New York’s top cryptocurrency regulator is set to greenlight a new stablecoin issued by cross-border payments company Ripple, FOX Business has learned.
People familiar with the matter say that the New York Department of Financial Services has indicated to Ripple that it will approve the product and that the company is considering a possible launch date of December 4. If approved, as expected, Ripple will be allowed to legally offer its product. stablecoin called RLUSD public, positioning it as a major player in the New York regulated financial market and the broader stablecoin ecosystem.
Press officials from Ripple and the Department of Financial Services, known by its acronym NYDFS, had no comment.
Ripple’s core business revolves around its decentralized global payments network, RippleNet, which uses blockchain technology to provide faster, cheaper and more efficient cross-border payment solutions to banks and businesses. It is presented as an alternative to the global banking settlement system called SWIFT. Ripple’s native token, XRP, serves as a bridge currency to settle these transactions, but the token is currently in regulatory limbo in the United States as the Securities and Exchange Commission continues to argue in court that it is of an unregistered title.
The case, currently in the appeal phase in the Second Circuit, could be dropped by the crypto-friendly Trump administration once it takes power in January. Meanwhile, with its future uncertain, XRP has been subject to volatile price swings.
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In 2020, the price of XRP fell more than 50% and its market capitalization lost $16 billion when the SEC sued Ripple for allegedly violating securities laws by selling XRP without first registering these sales to the commission. The price has remained well below $1 during the nearly four years Ripple has been engaged in a legal fight with the SEC.
# cryptography”.
President-elect Donald Trump has said he wants to make the United States the “crypto capital of the planet.” (Reuters/Kevin Wurm/File photo / Reuters Photos)
Today, XRP is trading at $1.70, making it the fifth largest cryptocurrency in the world with a market capitalization of over $99 billion.
By issuing a regulated stablecoin, Ripple will be able to offer a stable alternative to XRP to customers who want to use digital currencies without being exposed to volatility and regulatory uncertainty. The move will also put Ripple in direct competition with other established US stablecoin issuers like Circle, Paxos, and Gemini.
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Stablecoins, digital currencies pegged to assets with stable valuations like the US dollar, are primarily used as a store of value and medium of exchange to facilitate faster and cheaper transactions in cross-border payments and remittances using blockchain technology. The current valuation of the stablecoin market is around $190 billion and this figure is expected to increase under the new Trump administration, which is seen as capable of passing stablecoin regulations at the federal level.
The seal of the Securities and Exchange Commission hangs on the wall of the SEC headquarters in Washington, DC. (REUTERS/Jonathan Ernst/File photo / Reuters Photos)
For now, state-level regulation is the main solution for companies looking to offer stablecoins. The NYDFS is known for its strict approach to crypto regulation, ensuring that companies wishing to offer digital assets meet high regulatory standards, including meeting transparency, security, and consumer protection requirements. Obtaining a limited purpose trust charter, as Paxos and Gemini have done, is a way for New York companies to offer specific digital asset services without being subject to the more complex regulatory requirements of a traditional bank. Another solution is to use something called BitLicense, which allows exchanges like Coinbase and Robinhood to facilitate the trading and custody of cryptocurrencies.
In June, Ripple announced that it had completed the acquisition of Standard Custody & Trust Company, a limited purpose trust company licensed by the NYDFS. Standard Custody will be the issuer of RLUSD following regulatory approval. The acquisition helped accelerate the launch of Ripple’s stablecoin, as Standard Custody was already authorized by the department to offer custody services for digital assets when they acquired them.
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Ripple is expected to collaborate with other payment providers such as Bitstamp, Moonpay and Uphold for the planned rollout of its stablecoin next week.
“For another well-capitalized and highly regulated player, entering the global stablecoin market – especially as MiCA regulations in Europe are about to be implemented – is a win-win situation and MoonPay is proud to provide access to RLUSD to our partners and customers on day one of Ripple’s launch,” said Keith Grossman, President of Enterprise at MoonPay.
