Crypto investor Lark Davis argued that growth in Ripple USD (RLUSD) may not create substantial institutional demand for XRP (XRP), because the stablecoin can move across networks where XRP is not required.
In a Nov. 8 post on X, Davis pointed to RLUSD’s availability on multiple blockchains, including Ethereum. Transfers there do not require XRP. Transactions on the XRP Ledger use XRP to pay network fees, but Davis argued that institutions could handle thousands of transfers while holding as little as $50 in XRP. He presented that amount as an example of how little XRP might be needed for fees, not as a measurement of institutional balances.
Davis’s argument concerns the XRP needed to transact with RLUSD, while the assets have different uses. RLUSD is a dollar-backed stablecoin for transactions that require a stable value. XRP was designed to bridge currencies in cross-border payments: value can move into XRP, cross a network and convert into another currency. Davis said that use case appealed to him when he first bought XRP in 2017.
Davis argued that stablecoins can provide some of the speed and low cost associated with XRP-based transfers while offering a dollar-denominated option. He also said stablecoins have expanded across payments, trading and institutional finance. Ripple CEO Brad Garlinghouse has said RLUSD competes with other stablecoins rather than XRP.
October RLUSD transfers on the XRP Ledger totaled $20.1 billion, roughly nine times January’s volume. That figure measures transfer value; it does not show how much XRP institutions bought or held. The volume alone also does not establish that RLUSD growth creates matching demand for XRP.
