According to the announcement from SoFi, the project is expected to handle an annualized transaction volume of over $25 billion. Settlement has been facilitated through Mastercard's global payment network, with SoFiUSD serving as the underlying digital settlement asset.

This is not only related to SoFi. This development raises a competitive issue that could be very important for Ripple and its RLUSD: if large, regulated banks can issue their own stablecoins and directly connect to the global payment networks, will they still need third-party stablecoins to complete settlements?

SoFi Advances Stablecoin Settlement from Pilot to Official Production

SoFiUSD is issued by SoFi Bank. This bank is nationally licensed in the United States and is regulated by the Federal Reserve (Office of the Comptroller of the Currency). The token can be exchanged for US dollars at a 1:1 ratio and is primarily backed by cash reserves.

Unlike many previous stablecoin payment trials, the arrangements for SoFi and Mastercard are already in operation in a real production environment, rather than remaining at the proof-of-concept stage.

SoFi indicates that merchants do not need to hold stablecoins themselves, nor do they need to build new blockchain infrastructure. Settlement can be conducted through the bank platform of SoFi. After receiving the funds, enterprises can transfer them into their bank accounts and still convert them into cash.

On this occasion, Mastercard has been expanding its broader stablecoin strategy. Coinpaper has previously reported on its efforts to move towards 24/7 stablecoin settlement; Mastercard has also collaborated with Ripple, Gemini, and WebBank to launch a pilot project that uses RLUSD-based stablecoin credit card transactions, which is being conducted on XRP Ledger. This pilot makes the recent launch of SoFi particularly significant: Mastercard is not just betting on one stablecoin model.

Banks issuing stablecoins to RLUSD brings new problems

Ripple has positioned RLUSD as an institutional-level stablecoin aimed at payment, settlement, liquidity management, and tokenized finance. With Ripple expanding this asset to the fields of trading, payment, and institutional infrastructure, its market value has recently surpassed $2 billion.

The approach of SoFi is different in structure.

This bank has not adopted any external stablecoins; instead, it has issued its own digital dollar, which serves as the settlement infrastructure for its existing card business. If other banks also adopt this model, the stablecoin market could evolve into a mixed landscape consisting of issuer-specific bank tokens, independent regulated stablecoins (such as RLUSD and USDC), and tokenized deposits.

This does not necessarily weaken the strategy of Ripple. A fragmented ecosystem may actually increase the demand for interoperability and liquidity between different forms of digital currencies.

Ripple is also increasingly positioning itself as a broader provider of institutional financial services, with its business covering custody, payments, stablecoins, and fund management infrastructure, rather than relying on a single product. Therefore, if banks become more inclined to issue their own digital currencies, Ripple a broader institutional strategy may become even more important.