David Schwartz, the Chief Technology Officer of Ripple, has warned investors about possible supply constraints and price fluctuations for the company’s USD-pegged stablecoin, RLUSD, upon launch.

Schwartz confirmed that once supply and demand return to normal, the price of the stablecoin would settle close to its planned $1 parity, notwithstanding these anticipated swings.

Schwartz responded to worries about pre-launch offers that seem to be boosting the value of the RLUSD. According to reports, one bid on a Ripple (XRP) wallet called Xaman priced a portion of RLUSD at 511 XRP, which is more than $1,200. Schwartz explained that rather than reflecting actual market worth, such high bids probably reflect people looking for the novelty of holding the first RLUSD tokens.

The stablecoin is anticipated to launch shortly after receiving final regulatory permission from the New York Department of Financial Services, as stated by Ripple CEO Brad Garlinghouse. In order to strengthen its cross-border payment solutions and offer liquidity to financial institutions, Ripple intends to include RLUSD in addition to XRP.

The corporation views RLUSD as an addition to XRP, increasing its usefulness while making use of XRP’s extensive exchange availability to keep RLUSD’s price stable. Executives at Ripple have reaffirmed that the company’s main goal would be to support institutional participants, with beta testing showing promise for preventing depegging and enhancing worldwide liquidity.