A Deep Dive into Ripple, XRP, and the New RLUSD Stablecoin

On the weekend night of March 2nd, the crypto market was in turmoil when Trump suddenly released a statement regarding the U.S. Crypto Reserve:

Author: Will 阿望

On the weekend night of March 2nd, the crypto market was struck by a sudden wave of turmoil when Trump released a statement regarding the U.S. Crypto Reserve: "The U.S. Crypto Reserve will elevate the status of this key industry, which has been subject to corrupt attacks during the Biden administration for years. This is why my executive order on digital assets directs the presidential task force to advance a crypto strategic reserve that includes XRP, SOL, and ADA. I will ensure that America becomes the world’s crypto capital. We are making America great again!"

Afterwards, the crypto market was immediately seen to be surging, described as "an arrow piercing through the clouds, with thousands of troops coming to meet." Although BitMEX co-founder Arthur Hayes quipped that "there's nothing new," this fact does not diminish our interest in learning more about XRP and the company behind it, Ripple.

So, what is Ripple, and how does it relate to XRP?

1. Ripple Labs - A Fintech Company

Founded in 2012 and headquartered in San Francisco, California, Ripple Labs, commonly known as Ripple, is a fintech company specializing in blockchain-based solutions for cross-border payments and financial settlements. Its primary focus is on facilitating seamless and efficient international remittance within the traditional financial system using blockchain technology, ultimately aiming to speed up the velocity of global financial transactions and reduce their cost.

Some of Ripple's main products and services include:

I. Cross-border payments and remittances via RippleNet.

II. Recently launched RLUSD stablecoin.

The blockchain technology mentioned above is mainly the XRP Ledger network, which is an independent distributed ledger technology (DLT) used to record and verify transactions, while XRP is the native utility token that operates on this ledger. It is envisioned as an alternative to the SWIFT (Society for Worldwide Interbank Financial Telecommunication) payment network used by traditional financial institutions.

2. XRP Ledger - Blockchain Ledger Network

As early as 2011, Jed McCaleb began developing a new digital currency consensus network, and in 2012 he contacted Ryan Fugger, the founder of the peer-to-peer credit payment network RipplePay (now Ripple Payments), to further reaffirm the concept that Ryan Fugger had been developing since 2004. After discussions with the community, Ryan Fugger handed the platform over to Jed McCaleb, and the project was renamed Ripple. Subsequently, with further efforts from Jed McCaleb, Arthur Britto, and David Schwartz, the XRPL ledger was created in 2012, with XRP as its native token.

The XRP Ledger is a payment-focused blockchain network developed by Ripple in 2012, enabling financial institutions and payment providers to offer innovative financial services, including custody services, digital wallets, and other decentralized applications (DApps).

After the initial release of the XRP Ledger, Ripple concentrated on assisting financial institutions in handling cross-border remittances and payments using blockchain distributed ledger technology. Over time, Ripple developed various cross-border payment products, all of which were integrated into a top-tier service called RippleNet.

2.1 RippleNet

Among Ripple's numerous products, RippleNet stands out as one of the most prominent. Despite developing diverse financial products over the years, aiming to leverage the XRP Ledger and XRP, Ripple ultimately rebranded many of these ideas under one name: RippleNet. It is a global payment network connecting banks, payment service providers, and other financial institutions, providing real-time settlement and currency exchange services.

3. XRP - Native Token

Crypto asset within the XRP Ledger and serves as the native token of the XRP Ledger. The main role of XRP is to provide a faster and lower-cost global payment solution compared to traditional financial institutions.

XRP stands relatively independently and does not fully rely on Ripple. The XRP Ledger is maintained by independent validators worldwide (such as universities and exchanges), while Ripple only holds a large amount of XRP and participates in technical development. Even if Ripple were to shut down, XRP could still exist. This independence also provides greater scalability for XRP, thereby building a financial payment ecosystem based on XRP. For example:

DeFi and tokenization: XRPL supports the issuance of stablecoins, NFTs, and other assets (such as CBDCs).

Independent payment tools: Users can directly use XRP for peer-to-peer transfers without going through RippleNet.

Thus, the value of XRP is not directly related to the success or failure of Ripple Labs, and vice versa. Similarly, Ripple cannot restrict anyone from using XRP Ledger for their own services, although Ripple's large holdings of XRP may limit competition.

But Ripple is committed to improving the global payment system through its technology, and XRP is one of the key tools to achieve this goal.