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An unlucky trader has lost $27,000 by FOMOing into the recently-launched Ripple stablecoin $RLUSD with his $XRP holdings.
The trade occurred yesterday, Dec. 17 shortly after Ripple confirmed the launch of the much-anticipated stablecoin. For context, $RLUSD launched on Dec. 17, a few days after reports indicated that the New York Department of Financial Services (NYDFS) had granted its regulatory approval.
Details of the $XRP-$RLUSD Trade
However, it appears the excitement behind the launch resulted in the unfortunate trade. Notably, data from leading XRPL explorer Bithomp indicates that the trade began when a network participant placed an order to sell his 10,000 $XRP tokens for 100 $RLUSD.
The order was fulfilled on Dec. 17 at exactly 13:00 UTC, with the trader receiving the 100 $RLUSD in his wallet. Notably, $XRP was already witnessing an impressive rally during this period, as bullish sentiments followed the launch of the stablecoin.
As a result of this uptrend, $XRP was changing hands at the $2.71 mark when the transaction occurred. This indicates that the trader’s 10,000 $XRP tokens were worth a whopping $27,100 or 27,000 $RLUSD at the time the system fulfilled the order.
With the market participant receiving only 100 $RLUSD in this transaction, this confirms that he lost $27,000. However, this move cannot be regarded as an investment choice with hopes of future returns, as the Ripple stablecoin would always maintain its peg to the dollar, leaving the trader with $100.
$RLUSD is Not an Opportunity to Get Rich
The recent transaction highlights the mistakes certain network participants could make as a result of the euphoria surrounding the $RLUSD launch. Before the launch, Ripple CTO David Schwartz warned investors not to consider the stablecoin as an investment opportunity, as its value would always remain at $1.
Schwartz noted this while commenting on a disclosure that Xaman (formerly Xumm), a leading XRPL non-custodial wallet, showed a rate of $1,200 for 1 $RLUSD. This triggered speculations that $XRP’s price could adjust to this value, fueling the hope of a price surge for $XRP.
Schwartz dismissed these speculations, explaining that Xaman shows this rate because someone already placed an order to buy a small fraction of $RLUSD for $1,200. He cautioned that investors should not regard $RLUSD as a potential avenue to get rich.
It bears mentioning that the order referenced by Schwartz is similar to the latest one involving the 10,000 $XRP trade. However, in this trade, the investor placed his order to purchase 1 $RLUSD for 100 $XRP or $271, leading to the massive loss.
It is imperative that investors see $RLUSD as just another stablecoin, like Tether (USDT), and not an opportunity to rake in gains. XRPL validator Vet noted in a previous report that $RLUSD will always maintain a $1 price. Schwartz also suggested that the stablecoin’s benefit would be to improve liquidity, not to effect prices.