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Strategic advisor at Tether and VanEck fund manager Gabor Gurbacs has shared his take on the announced Ripple’s plan to launch a stablecoin backed by USD later this year.
In his tweet, Gurbacs has shared the key reasons why Tether’s USDT is likely to continue to dominate in the stablecoin market.
"There's only one king: It's Tether"- key reasons why
Gabor Gurbacs started his tweet, saying that every blockchain company wants to launch its own stablecoin. While being all for competition in the market, Gurbacs said that he believes the only king in the stablecoin market is Tether and its USDT.
The executive shared several key reasons why he believes that USDT is likely to remain unbeaten by Ripple’s future product or anybody else’s for that matter.
The first reason for USDT dominance is the Tether team that has “the right principles and history” and it can “support real use-cases that the market wants.” The next one is high liquidity that USDT boasts. Then comes the “right geo-focus” and finally – the “right design.”
Everyone wants to launch a stablecoin. I encourage competition but the truth is there is only one king: It's Tether. The Tether team has the right principles and history. High liquidity. Right geo-focus. Right design. Global team to support real use-cases that the market wants.
— Gabor Gurbacs (@gaborgurbacs) April 4, 2024
He also mentioned that small fees matter a lot while making crypto transactions, likely because one of the chains that Ripple intends to build its stablecoin on is Ethereum known for frequent jumps in fee levels. Finally, Gurbacs admitted that his tweet was inspired by the news about Ripple announcing its future USDT rival.
Ripple to launch stablecoin on two chains
Ripple chief executive Brad Garlinghouse has tweeted that launching a stablecoin later this year is a natural step forward for Ripple. The product will be built on both XRP Ledger and Ethereum chain. Garlinghouse stated that Ripple Labs possesses many years of the necessary experience, regulatory footprints, a strong balance sheet for this initiative and a large global network for payments.
He added that the future stablecoin and XRP will be used together “to offer the best of crypto-enabled payments.”
Launching a stablecoin is a natural step for Ripple as we bridge the gap between traditional finance and crypto. We have 1/ the years of experience 2/ regulatory footprint 3/ a strong balance sheet and 4/ a network with near global payout coverage, to offer the best of… https://t.co/GlyqhYl9ES
— Brad Garlinghouse (@bgarlinghouse) April 4, 2024
According to a recent Ripple thread on Twitter, the future stablecoin will be backed not only by USD but also by US government bonds and cash equivalents. The company also promises “monthly third-party attestations, ensuring trust and reliability.” Venturing into the stablecoin market will allow the XRPL to create more use cases, liquidity and opportunities not only for developers but users as well.