XRP: Ripple RLUSD Questions Spark Trust Debate

XRP has landed in the spotlight once again as Ripple’s U.S. dollar-backed stablecoin RLUSD stirs both support and skepticism across the crypto landscape. A clash of opinions erupted after well-known blockchain investigator ZachXBT publicly questioned RLUSD’s authenticity—before later removing the original post that triggered a flurry of reactions.

On July 1, ZachXBT took to social media to express doubt over the legitimacy of Ripple’s RLUSD adoption. He implied that the stablecoin’s current footprint lacked genuine user activity and suggested it relied heavily on Ripple‘s financial incentives to secure partnerships. According to the investigator, this approach manufactured an illusion of widespread adoption rather than stemming from organic growth.

Despite deleting the critical post, ZachXBT did not hold back from suggesting trust in alternative providers such as Circle, Paxos, and Tether, whom he views as more transparent in their operations and more aligned with trust and compliance expectations in the stablecoin ecosystem.

However, Ripple supporters were quick to challenge ZachXBT’s take. One prominent XRP advocate highlighted that RLUSD is actively integrated in Ripple’s payment network, notably through platforms like AEON and AlchemyPay, reaching millions of merchants globally. They argued that compensated collaborations are commonplace in the industry and shouldn’t be viewed as inherently lacking authenticity.

As one user pointed out in their rebuttal here, “Ripple pays for partnerships just like literally every major stablecoin project does. That’s not non ‘organic’ adoption, that’s how scaling works in this space.”

Introduced in December 2024, RLUSD is a U.S. dollar-pegged asset launched under a New York trust license, designed with compliance at its core. It is collateralized by cash and short-term U.S. Treasury holdings, providing a stable and regulatory-friendly vehicle for global crypto transactions. As of now, its circulating market cap has exceeded $455 million, cementing its position as a growing player in the stablecoin sector.

The controversy didn’t stop at Ripple, as ZachXBT also aimed criticism at Circle’s USDC. He claimed that North Korean cyber operatives utilize USDC as a conduit for illicit financial movements and castigated Circle for not flagging or freezing suspicious activity promptly. He shared that his investigations were directly responsible for freezing $3.6 million in USDC during 2024, which constitutes 27% of the protocol’s total frozen volume for that year.

This isn’t the first time Circle has faced scrutiny from the blockchain sleuth. Previously, ZachXBT alleged Circle delayed taking action against addresses linked to the Lazarus Group, a notorious North Korean hacking organization infamous for high-profile crypto heists. He accused the issuer of profiting off transactions before imposing any blacklists.

Meanwhile, Ripple’s advocacy for compliance-led growth continues. RLUSD stands apart as an offering from Ripple that favors transparency and trust. Issued via Standard Custody & Trust Company, the stablecoin’s intent is to bridge financial systems while adhering to regulation—a valuable asset in a time of increasing scrutiny on digital currencies.

The debates surrounding XRP and RLUSD reflect the larger conversation around what true adoption looks like within the incentivized and competitive stablecoin market. While some criticize token issuers for paid integrations, others recognize it as a standard—but necessary—practice to accelerate onboarding and global exposure.

Related: Expert Advice: Sell XRP If You’re Confused

As the stablecoin market matures, Ripple’s challenge will be to reinforce RLUSD’s presence not only through partnerships but also via organic user traction and real-world utility—a crucial combination that validates both adoption and trust in the long run.