Why The Ripple Stablecoin (RLUSD) Will Not Be Fully Operational This Year

The XRP community is currently abuzz with speculation regarding the imminent release of the Ripple stablecoin, RLUSD. Contrary to widespread rumors

XRPL validator Vet has clarified that the Ripple stablecoin (RLUSD) will not be fully operational on the XRP Ledger (XRPL) this year, owing to technical constraints.

Vet, who is also the co-founder of the leading NFT marketplace on the XRPL, explained in a post on X that the RLUSD will either launch only on the Ethereum network this year or be launched on the XRPL without the ability to be used in the Automated Market Maker (AMM) initially.

“I expect, or rather hope, for the latter,” Vet said.

The technical constraint stems from the ‘clawback’ feature enabled on the RLUSD, which is not currently supported by the XRPL for assets that can be used in the AMM.

“RLUSD is a stablecoin with clawback settings enabled. Tokens with this setting are denied by the XRP Ledger to be used in the AMM. There are amendments in the works to help solving this,” Vet added.

Specifically, Vet mentioned XLS-73 AMM Clawback and XLS-77, which aim to provide more control over trustlines and restrict the transferability of RLUSD under certain conditions. XLS-73 aims to modify the AMM system to accommodate assets with clawback features, while XLS-77 is intended to allow for a deeper freeze of Trustlines further securing the network against misuse by blacklisted accounts.

“In other words, because the XRPL is decentralized these amendments are impossible to predict when they will come, especially given the fatigue I observed. I love seeing people be excited about things happening on chain via the tracker I made, educating themselves on trustlines and IOUs on the XRPL is exactly where I want attention to go to, as opposed to screenshots of articles, partnerships and secret committee hot air talk,” Vet concluded.

Meanwhile, Ripple CTO David “JoelKatz” Schwartz commented on Vet's explanation, specifically on the role of XLS-77 in freezing assets, in a separate commentary on X.

“ FWIW, I’m not sure I like the description of XLS-77 as a ‘deeper’ freeze. If anything, it’s less deep. Unless I’m missing something, in any case where XLS-77 makes a difference, an asset that would have been frozen is, instead, not frozen,” Schwartz said.

Vet responded to Schwartz's critique by acknowledging the complexity of the terms and their implications across the XRPL infrastructure.

“Good point…hmmm…in my mind it made sense because the freeze goes beyond the trustline, it includes the payment engine and dex – maybe that's why ‘deep',” Vet said.

Another XRPL community member, Daniel Keller, sought further clarification on whether the core statement about the Ripple stablecoin is pure speculation or a fact, to which Vet replied that it is confirmed by the XRPL that it's not possible.