Ripple CTO Warns of RLUSD Shortages: Cautions Against FOMO Buying

Ripple CTO Warns of RLUSD Shortages: Cautions Against FOMO Buying

As Ripple prepares to launch its U.S. dollar-backed stablecoin, RLUSD, on December 17, Chief Technology Officer David Schwartz has issued a critical warning for early adopters: avoid FOMO-driven buying during the launch phase.

Taking to social media platform X on Sunday, Schwartz highlighted potential supply shortages in RLUSD’s early days, which could lead to temporary price spikes. He shared a striking example:

“There actually is someone willing to pay $1,200/RLUSD for a tiny fraction of one RLUSD.”

However, Schwartz reassured the community that such volatility would be short-lived, emphasizing:

“The price will come back to very close to $1 as soon as supply stabilizes. If it doesn’t, something is very seriously wrong.”

RLUSD Launch and Strategic Partnerships

RLUSD’s launch will initially be supported on platforms like Uphold, Bitso, Moonpay, Archax, and Coinmena, with planned expansion to major exchanges including Bullish, Bitstamp, Mercado Bitcoin, Independent Reserve, and Zero Hash.

Each RLUSD token is backed 1:1 by U.S. dollar deposits, U.S. government bonds, and cash equivalents, ensuring stability. Ripple has further committed to transparency, with monthly third-party audits conducted by independent firms to verify reserves.

Expert Advisors Strengthen Ripple’s Stablecoin Strategy

To guide financial and regulatory decisions, Ripple has enlisted former central bankers Raghuram Rajan and Kenneth Montgomery on its advisory board. Their expertise is expected to ensure RLUSD’s smooth integration into global markets and reinforce its credibility.

Ripple also anticipates that RLUSD’s launch will enhance liquidity within the XRP ecosystem, potentially driving increased adoption and a price rally for XRP.

Schwartz: “Don’t FOMO into a Stablecoin”

Addressing speculative behavior, Schwartz urged caution, warning that temporary price fluctuations caused by initial supply-demand imbalances are not an opportunity for quick profits:

“Please don’t FOMO into a stablecoin! This is not an opportunity to get rich.”

He stressed that the market would quickly correct itself, bringing RLUSD back to its intended $1 value. Schwartz’s message is clear: while excitement around RLUSD’s launch is warranted, speculative FOMO-driven buying could lead to unnecessary risks.

The Road Ahead

Ripple’s RLUSD stablecoin launch represents a significant step toward strengthening the XRP ecosystem and advancing digital payment solutions. However, as Schwartz advises, early users should exercise patience and focus on the stablecoin’s fundamental value rather than short-term price movements.