Ripple's highly regulated RLUSD stablecoin has experienced a significant market cap reduction.
Earlier today, the company burned more than 180 million tokens in mere hours, which is the single biggest one-day supply contraction in the history of the red-hot stablecoin that has become the darling of traditional finance players.
A $340 million market cap drop
According to a recent Deloitte audit, RLUSD had a circulating supply of roughly $1.56 billion in late February.
However, CoinGecko data shows that the token's market capitalization has nose-dived over the last few weeks. The current circulating supply of the token is sitting at 1.28 billion tokekns.
RLUSD's market cap has now been reduced by $340 million since the late February peak.
A "burn" is not necessarily a negative event since it is a standard operational mechanism. For instance, Ripple used to burn RLUSD tokens on the Ethereum blockchain to issue them on the XRP Ledger.
In this case, the Gemini exchange executed massive redemptions at the end of Q1. They have cashed out hundreds of millions of dollars worth of liquidity that they used for minting RLUSD with Ripple.
Slipping in stablecoin rankings
Due to the recent burn event, Ripple's RLUSD has now slipped in stablecoin rankings below Binance's BFUSD.
Ripple's RLUSD is still miles away from catching up with PayPal's PYUSD, another highly regulated stablecoin player. The latter has a market cap of more than $3.9 billion.
Tether (USDT), of course, remains unchallenged with a market cap of $184 billion. The stablecoin giant recently announced that it had hired a "Big Four" auditor.
Dan Burgin
U.Today Editorial Team
Vladislav Sopov
