Will RLUSD Replace XRP on the XRPL? Experts Weigh In

Ripple’s upcoming stablecoin, RLUSD, has ignited a fresh wave of debate about XRP’s utility within the XRP Ledger (XRPL). In a recent post on X, crypto analyst WrathofKahneman (@WKahneman) clarified misconceptions surrounding the stablecoin’s impact, emphasizing that RLUSD will not displace XRP’s critical function on the ledger.

While RLUSD offers the advantage of price stability and is expected to serve as a low-cost transactional asset, Kahneman pointed out that XRP remains indispensable due to the XRPL’s auto-bridging feature. This built-in functionality leverages XRP as a liquidity intermediary when two assets lack a direct trading pair, ensuring smooth execution and optimal exchange rates behind the scenes.

“Even if users never directly hold XRP,” Kahneman explained, “the system may use it invisibly to route transactions more efficiently.”

However, this viewpoint was challenged by Daniel Keller, CEO of Eminence, who downplayed the practical utility of auto-bridging. “There is no need for auto-bridging. I can onramp 1 to 1 if I want to,” Keller asserted, suggesting XRP’s role is overstated unless assets involved gain real market traction. He acknowledged the elegance of the mechanism but questioned its everyday relevance.

Also Read: Ripple’s $1.25B Hidden Road Deal: Could XRP Hit $10 If Volume Flows to XRPL?

Still, XRPL documentation reinforces Kahneman’s position. The decentralized exchange (DEX) can tap into synthetic order books, created via XRP, to route trades when direct token pairs are unavailable. This makes XRP a silent but essential engine powering liquidity.

While RLUSD may simplify certain transfers, it does not negate XRP’s foundational value in the XRPL’s infrastructure. The debate illustrates a broader tension between theoretical design and market adoption, but for now, XRP’s role in auto-bridging remains technically—and functionally—intact.

As Ripple prepares to launch RLUSD, the community will be watching closely to see how these assets interact in real-time, and whether XRP’s utility remains as strong in practice as it is in principle.

Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.

Sean Williams

I’m your translator between the financial Old World and the new frontier of crypto. After a career demystifying economics and markets, I enjoy elucidating crypto – from investment risks to earth-shaking potential. Let’s explore!