Ripple is signaling a major shift in how it manages XRP, as the new RLUSD revenue model could significantly reduce sell-pressure on the token. Historically, Ripple relied heavily on XRP sales to fund operations, creating recurring downward pressure on price. This old model forced token sales whenever revenue dipped, fueling investor concern about long-term stability.
The CTO of Ripple, David Schwartz, explains that RLUSD is designed to generate revenue independently of XRP sales, marking a fundamental change in the company’s approach. By diversifying income streams through enterprise solutions and payment networks, Ripple no longer needs to liquidate XRP reserves to fund its operations. This evolution transforms XRP from a source of operational cash flow into a utility asset with long-term value.
Previously, when revenue fell or XRP’s price dropped, Ripple was pressured to sell additional tokens to maintain business operations. This link between cash flow and XRP dumping created structural sell-pressure, which has now been addressed by introducing RLUSD. The stablecoin serves as a predictable, fiat-pegged revenue vehicle, allowing Ripple to stabilize its financial model without relying on XRP liquidation.
With RLUSD and other enterprise-grade products, Ripple builds robust, recurring income streams. This change reduces market fears that new products would compete with or undermine XRP. Instead, these services strengthen Ripple’s ecosystem by enabling innovation and scaling operations while preserving XRP reserves. Investors can expect less volatility caused by operational token sales, a positive signal for market stability and long-term confidence.
The distinction between RLUSD and XRP clarifies their roles: RLUSD provides stability and settlement in fiat value, whereas XRP focuses on speed, cross-border liquidity, and bridging assets. By generating independent revenue through RLUSD, Ripple removes the need to sell XRP to sustain operations. This reduces long-standing market pressures and supports XRP’s position as a core utility within the ecosystem.
Schwartz emphasizes that RLUSD is not a competitor to XRP but a catalyst that eliminates structural sell-pressure, potentially the most bullish shift the ecosystem has seen in years. With diversified income channels and enterprise-ready solutions, Ripple transitions into a sustainable model where XRP’s value is supported by the company’s broader growth and financial stability.