{"id":58172,"date":"2026-05-21T11:41:26","date_gmt":"2026-05-21T11:41:26","guid":{"rendered":"https:\/\/www.bitrabo.com\/discover\/?p=58172"},"modified":"2026-05-21T11:41:26","modified_gmt":"2026-05-21T11:41:26","slug":"evernorth-explains-why-rlusd-is-not-an-xrp-threat","status":"publish","type":"post","link":"https:\/\/www.bitrabo.com\/discover\/evernorth-explains-why-rlusd-is-not-an-xrp-threat\/","title":{"rendered":"Evernorth Explains Why RLUSD Is Not an XRP Threat"},"content":{"rendered":"\n

Evernorth\u2019s Chief Business Officer, Sagar Shah, has responded to speculation that Ripple\u2019s dollar-backed stablecoin, RLUSD, could supplant XRP. He asserts that these two assets occupy distinct roles within the realm of on-chain finance. In a recent blog post, Shah suggested that while RLUSD serves as a reliable digital dollar, XRP plays an essential role as a neutral asset for cross-asset settlement, liquidity, and collateralization on the XRP Ledger.<\/p>\n

This raises a common question within the XRP community: If RLUSD facilitates dollar transactions on-chain swiftly, what is the continued necessity for XRP?<\/p>\n

Shah contends that RLUSD<\/strong> and XRP<\/strong> perform different functions. As he explained, RLUSD serves as a dollar component in various transactions. Conversely, XRP acts as a bridge for markets where two parties may not naturally trade the same asset pair.<\/p>\n

<\/span>Understanding the Distinction<\/span><\/h2>\n

To clarify this distinction, Shah offered an analogy involving children trading snacks during recess. When one child has Goldfish and another has fruit snacks, direct trading can be problematic, especially if one child wishes for pretzels instead. The number of snack options correlates with the complexity of trades. For example:<\/p>\n

    \n
  • 10 different snacks create 45 possible trading pairs.<\/li>\n
  • 100 different snacks result in nearly 5,000 potential pairs.<\/li>\n<\/ul>\n

    This complexity mirrors the challenges faced in real markets as the variety of tokenized assets increases. Shah explained, \u201cThe probability that two children want to trade their exact snacks at the same time diminishes as the number of options grows.\u201d<\/p>\n

    In his analogy, a \u201cswap kid\u201d holds a bit of every snack, enabling others to trade without needing a direct match. This is the function that XRP fulfills on the XRP Ledger. For instance, while a trader might wish to exchange a tokenized Treasury bill for a euro stablecoin, the actual transaction could involve a pathway through XRP.<\/p>\n

    Shah emphasized that the role of XRP is often hidden from traders, who may simply see the exchange from \u201cTreasury bill in, euro stablecoin out\u201d without realizing XRP facilitates the process instantly.<\/p>\n

    Conversely, Shah described RLUSD as \u201cdistinct,\u201d functioning as a stablecoin valued at $1 and backed by adequate reserves. This makes it beneficial when one party in a trade seeks a digital dollar, but it does not qualify RLUSD as a universal routing asset.<\/p>\n

    He summarized this point by stating, \u201cRLUSD is not attempting to act as the swap kid. It is akin to a juice box \u2014 valuable and consistent when both parties desire a dollar.\u201d<\/p>\n

    This distinction is particularly significant in scenarios where there isn\u2019t a natural dollar component. Examples include:<\/p>\n

      \n
    • Tokenized Treasuries exchanged for tokenized euro money market funds.<\/li>\n
    • Lending markets denominated in various assets.<\/li>\n
    • Cross-asset transactions lacking dollar components.<\/li>\n<\/ul>\n

      Shah noted that these situations necessitate a neutral bridge asset, reinforcing the importance of XRP.<\/p>\n

      <\/span>Why RLUSD Will Not Replace XRP<\/span><\/h2>\n

      Shah outlined three critical reasons why he believes RLUSD cannot be considered a replacement for XRP:<\/p>\n

        \n
      1. Issuer Risk:<\/strong> RLUSD\u2019s existence is tied to a specific company that mints it and maintains reserves. If this issuer encounters issues\u2014such as regulatory or banking troubles\u2014the stablecoin can face challenges. While this risk is manageable if the stablecoin operates among multiple assets, it becomes problematic if it is seen as the primary routing asset.<\/li>\n
      2. Neutrality:<\/strong> Stablecoin issuers often have to comply with various regulations, such as sanctions or geographical restrictions. While these measures are suitable for a regulated stablecoin, they impede the ability to serve as a global routing asset.<\/li>\n
      3. Market Structure:<\/strong> Liquidity pools require two distinct assets. While pools can exist between RLUSD and other stablecoins or tokenized assets, determining which non-RLUSD asset serves as a common bridge across the ledger is essential. Shah believes XRP is positioned to fulfill this need due to its high liquidity and the protocol\u2019s pathfinding capabilities.<\/li>\n<\/ol>\n

        Moreover, Shah elaborated on XRP\u2019s ability to act as collateral in on-chain lending scenarios due to its liquidity and broad acceptance. Unlike issuable assets, XRP remains unaffected by external influences during the lifespan of financial agreements.<\/p>\n

        In conclusion, Shah posited that as on-chain finance evolves, there will be a persistent need for both a digital dollar like RLUSD and a routing asset such as XRP. Although both assets play unique roles, he emphasized the necessity of each in facilitating effective transactions.<\/p>\n

        At the time of writing, XRP is trading at $1.37.<\/p>\n

        <\/p>\n","protected":false},"excerpt":{"rendered":"

        Evernorth\u2019s Chief Business Officer, Sagar Shah, has responded to speculation that Ripple\u2019s dollar-backed stablecoin, RLUSD, could supplant XRP. He asserts that these two assets occupy distinct roles within the realm of on-chain finance. In a recent blog post, Shah suggested that while RLUSD serves as a reliable digital dollar, XRP plays an essential role as […]<\/p>\n","protected":false},"author":14,"featured_media":58173,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"slim_seo":{"title":"Evernorth Explains Why RLUSD Is Not an XRP Threat - Bitrabo","description":"Evernorth's Chief Business Officer, Sagar Shah, has responded to speculation that Ripple's dollar-backed stablecoin, RLUSD, could supplant XRP. He asserts that"},"footnotes":""},"categories":[316],"tags":[19434,682,2217,8979,517],"class_list":["post-58172","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-crypto-news","tag-evernorth","tag-heres","tag-killer","tag-rlusd","tag-xrp"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/posts\/58172","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/comments?post=58172"}],"version-history":[{"count":0,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/posts\/58172\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/media\/58173"}],"wp:attachment":[{"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/media?parent=58172"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/categories?post=58172"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bitrabo.com\/discover\/wp-json\/wp\/v2\/tags?post=58172"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}