The New York Department of Financial Services (NYDFS) is reportedly poised to approve Ripple Labs’ RLUSD, an overcollateralized stablecoin pegged to the U.S. dollar.
Ripple is preparing for a potential launch as early as December 4, Fox Business reported, citing sources close to the matter.
The anticipated approval positions Ripple to enter New York’s heavily regulated digital finance market, further solidifying its presence in the broader stablecoin ecosystem.
Ripple’s Business Revolves Around RippleNet
Ripple’s flagship business revolves around RippleNet, a decentralized payments network offering a faster and cost-efficient alternative to traditional banking systems like SWIFT.
The network relies on blockchain technology to facilitate cross-border transactions.
While RippleNet’s operations are closely tied to its native cryptocurrency, XRP, the token faces legal scrutiny in the United States.
The Securities and Exchange Commission (SEC) has accused Ripple of selling XRP as an unregistered security, a case now under appeal in the Second Circuit.
The ongoing legal battle has fueled volatility in XRP’s price, which surged to $1.70 following Donald Trump’s electoral victory, amid expectations of regulatory leniency under his administration.
New York Regulator To Approve Ripple’s Regulated Stablecoin, RLUSD, By December 4
Ripple is poised to launch its regulated stablecoin, RLUSD, on December 4th, pending approval from the New York Department of Financial Services (NYDFS). This milestone would make RLUSD a compliant… pic.twitter.com/74jh0udNk2— The Wolf Of All Streets (@scottmelker) November 30, 2024
Ripple’s move to introduce RLUSD reflects a strategic shift. By offering a regulated stablecoin, the company can provide customers with a reliable digital asset insulated from the price swings and regulatory uncertainty surrounding XRP.
RLUSD’s approval would pit Ripple against established U.S. stablecoin issuers like Circle, Paxos, and Gemini, all operating under New York’s stringent regulatory framework.
The NYDFS is renowned for its high standards, requiring companies to meet rigorous criteria for transparency, security, and consumer protection.
Ripple has positioned itself for this regulatory milestone through its June acquisition of Standard Custody & Trust Company, a limited-purpose trust chartered by the NYDFS.
This acquisition allowed Ripple to fast-track the issuance of RLUSD, as Standard Custody already held licenses to provide custodial services for digital assets.
RLUSD will serve as a key element in Ripple’s efforts to compete in the $190 billion global stablecoin market, which is poised for further growth under a pro-crypto federal government.
Ripple Labs CEO Faces Backlash for Shilling XRP and CBDCs in Alleged Trump Meeting
Ripple Labs CEO Brad Garlinghouse has recently come under fire after rumors surfaced of a meeting with President-elect Donald Trump where he promoted XRP and central bank digital currencies (CBDCs).
At the time, former Messari CEO Ryan Selkis accused Garlinghouse of “shilling XRP and CBDC implementations.”
Speculation about the meeting’s role in the rally has added fuel to the ongoing controversy.
During a recent Fox Business appearance, Garlinghouse declined to confirm or deny the meeting but praised Trump’s relationship with the crypto industry.
“Trump has embraced the crypto industry, and I think he recognizes its potential for innovation and entrepreneurship,” Garlinghouse said, expressing optimism about the sector’s future under the new administration.
Garlinghouse also noted the market’s positive response to Trump’s election victory, citing the hostile stance of SEC Chairman Gary Gensler as a major factor suppressing U.S.-based crypto projects.
Trump’s promise to fire Gensler on his first day in office has garnered widespread support from crypto enthusiasts.
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