Ripple RLUSD Supply Drops After Massive Token Burns as Open USD Stablecoin Gains Momentum

Ripple’s RLUSD stablecoin has experienced a sharp decline in circulating supply after major token burns on the XRP Ledger (XRPL), coinciding with the emergence of Open USD (OUSD), a new consortium-backed stablecoin that is drawing significant attention across the cryptocurrency industry.

Blockchain data shows that approximately 146 million RLUSD tokens were burned within a matter of hours on Tuesday, reducing the stablecoin’s market capitalization to around $1.4 billion, according to CoinGecko. The reduction marks a notable decline from RLUSD’s peak valuation of nearly $1.9 billion.

The token burns were large enough to shift RLUSD issuance dynamics, allowing Ethereum to overtake the XRP Ledger as the primary blockchain network supporting the stablecoin. The development has fueled discussions among investors and XRP community members about Ripple’s evolving stablecoin strategy.

The supply reduction comes as Open USD (OUSD) enters the market with backing from a consortium of more than 140 financial, technology, and cryptocurrency companies. Ripple recently confirmed it has joined the initiative, which features major participants including BlackRock, Mastercard, Google, Visa, Stripe, and other industry leaders.

Unlike many existing stablecoins, Open USD will operate under the independent Open Standard organization and use a shared governance model. The project aims to address key challenges in the stablecoin sector, including scalability, governance, and incentive structures, while encouraging broader adoption of digital dollar assets.

The launch of OUSD has sparked mixed reactions within the XRP community. Some supporters believe Ripple’s involvement could strengthen the broader digital asset ecosystem and ultimately increase XRP adoption. X user @nietzbux argued that a consortium-backed stablecoin may accelerate mainstream cryptocurrency adoption and create long-term benefits for Ripple’s ecosystem.

Others remain cautious. Panos Mekras, CEO of Anodos, noted that Open USD will naturally compete with Ripple’s own RLUSD stablecoin, raising questions about how both assets will coexist in the rapidly expanding stablecoin market.

The announcement also impacted publicly traded stablecoin issuer Circle. Shares of Circle fell more than 15% after Open USD was introduced, as investors weighed the potential competitive threat to USDC. However, analysts at William Blair described the selloff as excessive, pointing to USDC’s established liquidity, broad adoption, and strong market position as advantages that will be difficult for new entrants to replicate.

Circle CEO Jeremy Allaire welcomed the increased competition, saying continued innovation benefits the digital asset industry. He emphasized that the company remains focused on expanding its stablecoin infrastructure while delivering greater value to customers and strategic partners.

As competition intensifies in the stablecoin market, Ripple’s RLUSD, Open USD, and Circle’s USDC are expected to play key roles in shaping the next phase of institutional and mainstream cryptocurrency adoption.