Ripple Backed Palau’s Stablecoin – But the Project Skipped Legal Steps. What’s Next?

The island nation of Palau, in partnership with Ripple, tested the launch of its own stablecoin PSC (Palau Stablecoin) built on the XRP Ledger. The goal was to enhance financial inclusion and reduce transaction costs. While the pilot phase brought some interesting results, a recent audit revealed that the project bypassed several legal procedures.

💸 Ripple Donated $25,000 – Funds Used, But Without Proper Approvals The pilot program included three local merchants and 154 government officials who voluntarily transacted with PSC. Ripple funded the project with a $25,000 donation, most of which—over $14,000—was distributed among merchants to circulate test stablecoins. The issue? The Ministry of Finance reportedly did not obtain all the required legal approvals. The agreement with Ripple was not verified by the Attorney General or the National Program Director, as required by local regulations. Although no funds were misused and the finances were transparently handled, the public auditor flagged it as a warning.

⚖️ From Pilot to National Currency? Not Yet While PSC functioned as an experiment, a full rollout would essentially mean introducing a new national currency—something that legally requires parliamentary approval (Olbiil Era Kelulau). Without it, the auditor clearly stated, such expansion would be unlawful. The Ministry defended its actions by stating the agreement with Ripple was only a non-binding Memorandum of Understanding (MOU), guided by advice from the Office of the President.

🌐 Meanwhile, XRPL Expands with Stablecoins and Tokenized Bonds Ripple and the XRP Ledger continue to grow. The XRPL now hosts several stablecoins, including Ripple’s RLUSD, Circle’s USDC, EURØP (pegged to the euro), XSGD (Singapore dollar), and USDB from Braza Group. At the recent Apex 2025 conference, Ripple showcased the XRPL’s evolution in both stablecoins and tokenized real-world assets (RWA). For example, tokenized U.S. Treasuries (OUSG) by Ondo are now available to qualified investors directly on XRPL. Guggenheim Treasury Services has also launched digital commercial papers on XRPL in partnership with Zeconomy. Looking ahead, Ripple plans to introduce enterprise-level features like login credentials, verified domains, and multi-purpose tokens—further positioning XRPL as a robust institutional blockchain for digital assets.

#Ripple , #xrp , #Stablecoins , #CryptoInnovation , #CryptoNewss

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