Ripple is to acquire crypo-friendly prime brokerage Hidden Road for $1.25 billion, representing one of the largest deals in the digital assets space.
With the acquisition, Ripple becomes the first crypto company to own and operate a global, multi-asset prime broker capable of offering institutions a one-stop-shop of services including, clearing, prime brokerage, and financing across foreign exchange (FX), digital assets, derivatives, swaps, and fixed income.
Hidden Road has a strong business, clearing $3T annually across markets with more than 300 top institutional customers.
Ripple, which participated in Hidden Road’s Series B and is a customer of its platform, plans to inject billions of dollars into the business to provide immediate scale..
“We are at an inflection point for the next phase of digital asset adoption - the US market is effectively open for the first time due to the regulatory overhang of the former SEC coming to an end, and the market is maturing to address the needs of traditional finance,” says Brad Garlinghouse, CEO of Ripple. “With these tailwinds, we are continuing to pursue opportunities to massively transform the space, leveraging our position and the strengths of XRP to accelerate our business and enhance our current solutions and technology.”
The acquisition also reinforces Ripple USD's (RLUSD) position as an enterprise-grade USD-backed stablecoin with real utility as Hidden Road uses it as collateral across its prime brokerage products. This will make RLUSD the first stablecoin to enable cross-margining between the digital asset space and traditional markets.
Hidden Road will, in turn, migrate its post-trade activity across Ripple's DeFi blockchain XRPL, incorporate Ripple payments for liquidity and deliver digital asset custody services from Ripple to its institutional client base.
“With new resources, licenses, and added risk capital, this deal will unlock significant growth in Hidden Road’s business, allowing us to increase capacity to our customer base, expand into new products, and service more markets and asset classes,” says Marc Asch, founder and CEO of Hidden Road. ”Together with Ripple, we’re bringing the same level of trust and reliability that institutional clients are accustomed to in traditional markets — designed and optimized for a digital world.”
News of the deal comes as Standard Chartered forecasts that Ripple'd digital token XRP could rise to $12.50 by end-2028, up from its current price of $1.94.