Ripple Acquires Hidden Road for $1.25 Billion
In a significant move within the digital asset landscape, Ripple has announced its acquisition of multi-asset prime brokerage firm Hidden Road for a staggering $1.25 billion. This transaction stands as one of the largest mergers and acquisitions in the digital asset sector to date. According to a report from CoinDesk, discussions regarding the acquisition were already underway last week.
Hidden Road is a notable player in the financial industry, clearing over $3 trillion annually across a diverse array of markets, including foreign exchange, derivatives, digital assets, and fixed income. The firm boasts a robust client base of more than 300 institutional clients, as highlighted in the press release detailing the acquisition.
The announcement, however, did not disclose specific funding terms related to the deal. Ripple’s CEO, Brad Garlinghouse, emphasized the importance of this acquisition in a statement, saying, “With the U.S. market finally opening up and digital assets maturing for institutional adoption, this is an inflection point.” He further elaborated, “We are accelerating our expansion, leveraging XRP and our broader solutions to bring traditional finance and crypto closer together.”
As part of the acquisition strategy, Ripple intends to inject new capital into Hidden Road to enhance its clearing, prime brokerage, and financing operations. The goal is to position Hidden Road as the largest non-bank prime broker in the world.
This acquisition also aligns with Ripple’s ambitions in the stablecoin arena. Hidden Road plans to utilize Ripple’s U.S. dollar-backed stablecoin, RLUSD, as collateral within its prime brokerage platform. According to Ripple, this makes RLUSD the pioneering stablecoin that facilitates efficient cross-margining between traditional and digital asset markets.
Moreover, Hidden Road has plans to transition its post-trade operations onto the XRP Ledger (XRPL), which aims to minimize costs and streamline settlement processes. Ripple anticipates that this transition will further demonstrate XRPL’s capabilities as a blockchain optimized for institutional decentralized finance (DeFi) applications.
Ripple, which had previously participated in Hidden Road’s Series B funding round and has also utilized its platform, expects the deal to finalize in the coming months, contingent on receiving the necessary regulatory approvals. The company currently holds over 60 regulatory licenses worldwide.
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