Crypto Eri, a prominent figure in the XRP community, recently reached out to David Schwartz, a Ripple executive, for clarification on whether the XRP Ripple holds are part of the “Cash Equivalent” that will back the upcoming stablecoin. This inquiry came after Eric van Miltenburg, Ripple’s SVP for Strategic Initiative, suggested that the stablecoin would benefit the XRP Ledger (XRPL), despite concerns that it could harm XRP.
Miltenburg argued that launching the stablecoin on XRPL would ultimately be beneficial for the XRP ecosystem. He drew parallels with other blockchain networks, such as Polygon, where stablecoins have helped increase the volume of total value locked (TVL) on-chain and improve trust.
However, Crypto Eri found a discrepancy in Miltenburg’s comparison of TVL and sought clarification from David Schwartz. She asked whether the XRP Ripple holds would be included in the “cash equivalent” that backs the stablecoin. If XRP is not included, she questioned the rationale behind the claim that stablecoins increase TVL on other chains.
In response, David Schwartz clarified that there is currently no native mechanism to “lock up” assets on XRPL. He explained that Miltenburg’s reference was likely regarding how the presence of high-quality stablecoins stimulates activity on other blockchains, as evidenced by the rise in locked value. Schwartz also highlighted that stablecoins on XRPL can serve various purposes, such as providing individuals with a means to hold funds without exposure to crypto volatility and acting as assets for automated market makers (AMMs) alongside XRP. He emphasized that stablecoins can enhance the overall usability and functionality of XRPL.
In essence, Schwartz believed that Miltenburg’s point was that stablecoins enhance the appeal and utility of blockchains in general, not just in terms of TVL.
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