Ripple reactivated its RLUSD minting mechanism, introducing 12 million new tokens into circulation. This follows a strategic hiatus since April, undertaken to stabilize supply and calibrate with market demand.
The mint came shortly before the US Senate votes on the GENIUS Act, a bill introducing a federal regulatory regime for stablecoins, on June 17.
The timing indicates a strategic play by Ripple to build more liquidity for RLUSD before impending regulation.
The blockchain digital payment company stopped issuing its stablecoin in April in hopes that the token would maintain its market standing and they could regulate the circulating asset count.
The firm last issued its RLUSD stablecoin on April 25, releasing two tranches of about 23 million tokens. So far, around 425.74 million RLUSD tokens are presently in circulation, per CoinMarket cap analysis.
Ripple burned some of its RLUSD tokens in May
Ripple’s decision to mint more tokens just before the GENIUS Act vote on June 17 hints at the company’s confidence in the bill’s approval and a bullish stablecoin market.
In the last few months, the firm has consistently put effort into checking its stablecoin supply. The platform burned roughly 4 million RLUSD tokens in May, taking them out of the circulating supply. Plus, it stopped minting, striking a balance between supply and demand in the market.
The company has also been working on infusing its stablecoins on several platforms. RLUSD has already been listed on several exchanges and financial platforms, including Bitget, Gemini, and Revolut, to enhance its accessibility and utility.
The GENIUS Act’s supporters believe it would encourage stablecoin issuance
If the GENIUS Act is approved, it would set regulatory frameworks for stablecoins and help provide clarity to companies like Ripple in the stablecoin market.
If the bill wins the key vote on June 17, the bill will move to the US House of Representatives, and eventually, the bill may just be passed into law.
Nic Puckrin, a crypto analyst, investor, and founder of The Coin Bureau, believes the bill would make stablecoins more mainstream and encourage more companies to venture into stablecoins. So far, Puckrin sees the stablecoin market as a duopoly, mainly controlled by Circle’s USDC and Tether’s USDT.
Puckrin commented, “Since the bill will create a clear pathway for banks and other entities to begin issuing stablecoins. We’ll likely see a flood of them rush into the market at the start.”
He added that banks are preparing to create their own tokens, and although not all will succeed, they will expand consumer choice in finding a stablecoin and issuer that fits their preferences.
Senator Bill Hagerty, who introduced the bill to the Senate, is urging his fellow lawmakers to vote on it, claiming that without regulation, stablecoin innovation will only continue internationally, excluding America, and they would fall behind in global competitiveness.
Puckrin also suggested that Congress is beginning to realize the positive effect stablecoins can have on the nation’s position in the world, as USD backs the majority of stablecoins. He thinks the GENIUS Act may be the answer the USD needs to hold on to global power.
Other bill champions have recognized that the legislation may not be perfect but believe that passing it is better than having no stablecoin regulation at all.
Bezalel Eithan Raviv, CEO of the blockchain security firm Lionsgate, shares a similar view, saying that having the bill is better than what’s currently being done.
Those opposing the bill have argued that it threatens the decentralized nature of crypto and could open the door to corruption, including regulators showing favoritism toward certain stablecoins.
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