- Ripple agrees to buy prime broker Hidden Road for $1.25B to link TradFi & DeFi
- Analysis: Deal banks on XRPL’s power to handle Hidden Road’s $3T+ annual volume
- Ripple’s RLUSD stablecoin planned as collateral to ease cross-asset margining
Ripple has agreed to buy Hidden Road, a prime broker that works with institutional clients in both traditional and digital assets, for $1.25 billion. The deal still needs regulatory approval and is expected to close in the next few months.
This buy marks one of the biggest recent acquisitions in the crypto sector, setting up Ripple to better blend traditional finance operations with digital assets. The purchase would make Ripple the first major crypto firm to own and run a global prime brokerage that handles multiple asset types.
Hidden Road’s Strong Institutional Ties
Hidden Road is already a key player in both traditional and digital asset markets, handling trades for over 300 institutional clients.
The firm processes over $3 trillion a year in trading volume across assets like foreign exchange, digital assets, and derivatives. Ripple believes this acquisition will boost its institutional business by combining Hidden Road’s solid infrastructure with its own blockchain know-how.
Using RLUSD to Connect Different Asset Markets
The deal also highlights Ripple’s plan to link decentralized finance (DeFi) with traditional banking systems. Ripple’s own stablecoin, Ripple USD (RLUSD), is slated to play a big part. It’s expected to be used as collateral in Hidden Road’s prime brokerage services.
Related: Ripple Calls on UK Government to Expedite Crypto Asset Regulation
If successful, RLUSD could be the first stablecoin to make cross-margining work efficiently between traditional and digital markets, potentially improving liquidity and creating a simpler trading setup for institutional investors.
XRPL Integration:The Make-or-Break Technology Test
On top of that, Hidden Road plans to move its post-trade operations to the XRP Ledger (XRPL). This move aims for lower operational costs and better scalability, benefits often promised by blockchain.
But shifting Hidden Road’s $3T+ yearly institutional volume is a major test of XRPL’s ability to handle high-speed settlements reliably – something other blockchains haven’t consistently done compared to traditional financial systems.
This technology challenge really shows what’s riding on the deal: proving XRPL can support demanding institutional tasks now handled by specialized custodians and established settlement networks.
Related: Is Ripple Quietly Reducing Its XRP Sales Pressure? Escrow Data Analyzed
Deal Expected to Drive Global Growth
Hidden Road’s CEO, Marc Asch, said the acquisition gives the company the resources and licenses it needs to grow globally. Using Ripple’s support and technology, Hidden Road expects to scale its business and offer its services to more clients around the world.
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