Ripple, a leading blockchain technology company, has announced its acquisition of the prime brokerage firm Hidden Road for a staggering $1.25 billion. This strategic move marks Ripple’s first venture into owning and operating a global, multi-asset prime broker, a significant leap in its mission to strengthen its institutional services.
Hidden Road, known for serving over 300 institutional clients, plays a significant role in financial markets by clearing an impressive $3 trillion annually across a variety of asset classes, including digital assets, foreign exchange, derivatives, swaps, and fixed income. Ripple's acquisition of Hidden Road is poised to bridge the gap between traditional finance and decentralized finance (DeFi), enabling Ripple to offer institutional clients a comprehensive set of trading, clearing, and settlement solutions that adhere to conventional financial standards.
One of the key goals of this acquisition is to enhance the utility of Ripple’s U.S. dollar-pegged stablecoin, RLUSD. Ripple plans to use RLUSD as collateral for Hidden Road’s prime brokerage products. This integration is expected to make RLUSD the first stablecoin that enables efficient cross-margining between traditional and digital asset classes, providing Ripple’s institutional clients with an innovative solution for their trading activities.
The acquisition also facilitates the transition of Hidden Road’s post-trade activities to Ripple’s XRP Ledger (XRPL). This move aims to streamline operations and reduce costs for institutional clients engaging in both digital and traditional asset markets. The integration of XRP Ledger is poised to demonstrate its potential as a robust blockchain solution capable of supporting institutional DeFi applications, further solidifying Ripple’s presence in the evolving financial landscape.
Ripple CEO Brad Garlinghouse expressed his confidence in this acquisition, citing the evolving regulatory environment and the growing maturity of the market as pivotal factors behind this strategic decision. He emphasized that the U.S. market is now more receptive to digital asset adoption, creating new opportunities for Ripple to integrate decentralized finance with the broader
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