Wietse Wind’s fresh comments about the XRP Ledger native token show that no code can be written to transform XRP into a stablecoin. This he said in response to a user who asked about the possibility of XRP becoming a stablecoin.
Per a Wednesday Twitter discussion, the XUMM Wallet lead developer noted that “XRP already is a stable coin”, stating that 1 XRP equals 1 XRP. The stability of XRP here, as implied by him, is not in terms of price but in the sense that the token does not rely on another blockchain to be functional. He wrote, “XRP lives on its own network. There can’t be price in the protocol on the network, because: price vs what?”
However, Wietse Wind highlighted some conditions that could transform XRP into a stablecoin with no price fluctuations. According to him, the dollar value of XRP cannot be stable because users offer varying prices for the crypto asset.
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Hence, he implied that for XRP to be stable, all crypto traders interacting with the coin must offer a stable price for it. In addition, Wietse mentioned that another condition for XRP to behave as a stablecoin is if all on-ramp and off-ramp of XRP decide to sell the coin only at a certain ‘fist equivalent’.
He wrote,
“The price of XRP comes from interaction with the world around the network: supply and demand. And since the price people offer is never stable, neither can XRP be.”
“The only way for that to work is if ALL On- and Offramps of XRP collectively decide they won’t sell if not exactly at a certain fist equivalent. Which is never happening with the amount of exchanges, DEX, etc.”
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“I guess the only hypothetical way would be if stores and people start pricing goods and services in fixed XRP value, which would only work if their vendors, employees, everyone would do that as well. Never going to happen,” he concluded.
I guess the only hypothetical way would be if stores and people start pricing goods and services in fixed XRP value, which would only work if their vendors, employees, everyone would do that as well. Never going to happen.
— WietseWind – 🛠 XUMM @ XRPL Labs (@WietseWind) December 29, 2022
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