Ripple's ambitious stablecoin, RLUSD, has been making significant waves since its launch. However, a fascinating trend has emerged: the vast majority of its supply is finding its home on the Ethereum network, rather than Ripple's native XRP Ledger (XRPL). This development highlights the powerful gravitational pull of established decentralized finance (DeFi) ecosystems.
According to recent data, RLUSD's total circulating supply has rapidly expanded to an impressive $1.26 billion within just 12 months of its introduction. What's particularly striking is the distribution of this supply: approximately $1.03 billion, or a substantial 82% of the total, now resides on Ethereum. In contrast, the remaining $235 million balance is currently held on the XRPL.
These figures paint a clear picture: the market appears to overwhelmingly favor the deep liquidity and composability offered by the Ethereum Virtual Machine (EVM) over the XRPL's more compliance-focused architecture. It's a compelling narrative about where capital naturally flows in the crypto space.
The Ethereum Advantage: A Mature Ecosystem
The primary reason for this significant disparity lies in the fundamental maturity of the underlying financial infrastructure. When RLUSD arrived on Ethereum, it entered an environment already rich with entrenched dollar liquidity and a vibrant DeFi landscape. This isn't just anecdotal observation, but a fact supported by data. DeFiLlama confirms that Ethereum continues to lead all blockchain networks in total value locked (TVL) and stablecoin supply, providing a ready-made, turn-key ecosystem for new assets like RLUSD.
Any new stablecoin that can seamlessly integrate into major DeFi protocols, such as Aave, Curve, and Uniswap, immediately benefits from existing routing engines, collateral frameworks, and robust risk models. RLUSD's quick integration into Aave and Curve provides tangible evidence of this advantage. The USDC/RLUSD pool on Curve, for instance, now boasts approximately $74 million in liquidity, positioning it as one of the larger stablecoin pools on the platform.
For institutional treasuries, market makers, and arbitrage desks, this depth of liquidity is absolutely essential. It guarantees low-slippage execution for trades that can run into tens of millions of dollars, thereby facilitating the complex basis trades and yield-farming strategies that are the lifeblood of modern crypto capital markets.
In stark contrast, the XRPL is still in the foundational stages of building its DeFi infrastructure. Its protocol-level automated market maker (AMM) only went live in 2024. Consequently, all RLUSD-related pools on the ledger, including the USD/RLUSD pair established in January 2025, are still contending with shallow depth and limited follow-through. Moreover, the XRPL AMM's design has not yet managed to attract the density of liquidity providers seen in more mature EVM ecosystems. This means that a dollar of RLUSD on XRPL currently finds far fewer avenues for swaps, leverage, or yield generation compared to the same dollar deployed on Ethereum.
RLUSD's Growing User Base and Utility on Ethereum
"Critics might argue that RLUSD’s Ethereum supply is merely ‘vanity metrics,’ large sums minted but sitting idle. However, a deeper analysis of on-chain transfer data refutes this. RLUSD is showing a genuine product-market fit with Ethereum, characterized by high velocity and recurring usage."
Far from being just impressive but inactive numbers, RLUSD's presence on Ethereum demonstrates a genuine and growing product-market fit, marked by high velocity and consistent usage. According to Token Terminal, the weekly RLUSD transfer volume on Ethereum now averages approximately $1.0 billion. This represents a dramatic surge from the $66 million average observed at the beginning of the year.
The data clearly indicates a structural shift, with a steady upward trend throughout the first half of 2025, followed by a "re-basing" to a significantly higher floor in the second half. Crucially, recent weeks show sustained activity around this elevated level, rather than transient spikes. In market structure terms, a rising baseline typically signals a transition from a distribution phase to a utility phase. This implies that the token is being actively used in ongoing, recurring flows, such as institutional settlement and commercial payments, rather than being confined to isolated speculative events.
Supporting this thesis, transfer counts have also risen in parallel. Weekly transactions on Ethereum now average 7,000, a substantial increase from just 240 in January. The concurrent rise in both volume and transaction counts is a critical health indicator. If volume were to rise while transaction counts remained flat, it might suggest a market dominated by a few large-sum movements. Instead, the parallel growth points to broader participation across a wider range of users.
Furthermore, the holder data suggests a healthy dispersion of risk. As of late November 2025, Etherscan data shows that Ripple's RLUSD has attracted roughly 6,400 on-chain holders on Ethereum, a significant jump from just 750 at the start of the year.
While the overall supply growth has been driven by sizable batch issuances rather than continuous drip minting, the number of holders has followed a smooth and consistent upward curve, indicating organic adoption.
The Friction Point: XRPL's Design Choices
The stark structural differences between the two networks explain why the "permissionless" growth loop has so strongly favored Ethereum. On Ethereum, RLUSD functions as a standard ERC-20 token. Wallets, custodians, accounting middleware, and DeFi aggregators are already perfectly optimized for this universal standard. Once a protocol like Curve integrates a token, it seamlessly becomes part of the standard dollar-pair universe alongside established giants like USDC and USDT, accessible to any address without requiring prior authorization.
Conversely, the XRPL's design choices, while technically robust and often praised for their efficiency, unfortunately impose significantly higher friction on the end-user. To hold RLUSD on the native ledger, users typically need to maintain a minimum XRP balance to satisfy reserve requirements and configure a specific trustline to the issuer. Moreover, if the issuer enables the RequireAuth setting, a feature designed for strict compliance and granular control, accounts must be explicitly allow-listed before they can even receive tokens.
While Ripple notes that these features can be very appealing to banks and other regulated entities that demand explicit control over asset flows, they inevitably act as a brake on organic, widespread adoption. Essentially, the very compliance tools that make XRPL attractive to highly regulated entities are the same features that slow down frictionless, wallet-to-wallet distribution and broad ecosystem participation. In a market where capital inherently seeks the path of least resistance, the operational burden imposed by trustlines renders XRPL less competitive for the high-frequency, automated flows that are characteristic of modern DeFi.
RLUSD's Future Path to Growth
Despite the current ledger imbalance, the overall upward trajectory of RLUSD positions Ripple within striking distance of a major market tier. Token Terminal has suggested that if RLUSD's market capitalization were to grow tenfold from its current levels, Ripple would solidify its position as the third-largest stablecoin issuer globally, trailing only the entrenched incumbents, Tether and Circle.
Considering this ambitious goal, RLUSD's continued growth hinges significantly on whether Ripple can effectively leverage its success on Ethereum to eventually jumpstart activity and liquidity on its native chain. A reasonable base-case projection for the next six months anticipates RLUSD's Ethereum supply climbing from approximately $1.0 billion to a range of $1.4 billion to $1.7 billion. This projection assumes that Curve liquidity remains within the $60 million to $100 million band and that demand from centralized exchanges (CEX) and over-the-counter (OTC) desks continues its steady growth. Under this scenario, the XRPL would likely see its pools accumulate more liquidity over time, but remain a relatively small fraction of the aggregate issuance.
However, a more aggressive "catch-up" scenario for the XRPL would require deliberate and strategic market intervention. If Ripple or its partners commit to multi-month AMM reward programs and successfully manage to mask the complexities of trustline configurations behind intuitive, single-click wallet interfaces, the native ledger could plausibly begin to erode Ethereum's substantial lead. With these levers actively pulled, XRPL liquidity could realistically reach $500 million and potentially claim up to 25% of the total RLUSD supply.
Yet, the downside risk for the native ledger is very real. If Ethereum further solidifies its lead and the Curve USDC/RLUSD pool expands beyond $150 million, the powerful network effects could become almost insurmountable. In such a scenario, Ethereum might well retain 80% to 90% of the RLUSD supply indefinitely. For the time being, Ripple finds itself in a paradoxical situation: to truly succeed in its ambition to become a top-tier stablecoin issuer, it must, at least for now, significantly rely on the robust infrastructure and vibrant ecosystem of its biggest competitor, Ethereum.
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