Ripple Pays $1.25 Billion For Prime Brokerage Hidden Road

Stablecoin company Ripple has purchased prime brokerage Hidden Road for $1.25 billion.

The acquisition makes Ripple the first cryptocurrency company to own and operate a multi-asset prime broker and marks one of the largest-ever deals in the digital asset space, Ripple said in a news release Tuesday (April 8).

According to the release, Hidden Road is one of the fastest-growing prime brokers around the world, offering services including clearing, prime brokerage and financing across foreign exchange (FX), digital assets, derivatives, swaps and fixed income.

“For the crypto industry to achieve the next phase of growth, it’s critical that core infrastructure is in place for institutional adoption; prime brokers bring the necessary credibility and professional trading services expected in legacy finance to digital assets,” the release said. “Together, Ripple and Hidden Road are bringing the promise of digital assets to institutional customers at scale, bridging traditional finance and decentralized finance.”

The release noted that Hidden Road clears $3 trillion per year across markets with more than 300 institutional customers. With Ripple’s backing, the brokerage can now become the largest non-bank prime broker in the world.

“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,” said Brad Garlinghouse, CEO of Ripple.

“With these tailwinds, we are continuing to pursue opportunities to massively transform the space, leveraging our unique position and strengths of XRP to accelerate our business and enhance our current solutions and technology,” he added.

As PYMNTS wrote Tuesday, stablecoins such as Ripple’s have been the crypto sector’s biggest success story, with roughly $234 billion in circulation.

“But while the top 10 stablecoins by market share, representing well over 90% of the tokens in issuance, are U.S. dollar-denominated, the U.S. still does not have a regulatory framework in place to govern the sector,” PYMNTS wrote. “Lawmakers are trying to change that, particularly in light of the current administration’s comparatively warm embrace of the crypto space.”

However, this proposed legislation has drawn sharp opposition from certain areas, such as the Conference of State Bank Supervisors (CSBS) who argue the bill would expand federal oversight at the expense of state regulatory authority.