Ripple plans to acquire Hidden Road in $1.25 billion deal

Investing.com -- In a significant move, Ripple announced on Tuesday that it will acquire Hidden Road, a multi-asset prime broker, in a $1.25 billion deal. This acquisition will be one of the largest by the crypto company.

This is the second time this year that a crypto company has been involved in a billion-dollar-plus deal. This comes at a time when digital assets like bitcoin are gaining more prominence under the leadership of U.S. President Donald Trump, who has pledged to be the "crypto president".

Ripple CEO Brad Garlinghouse stated that the U.S. 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. Prime brokers, such as Hidden Road, are crucial to the day-to-day operations of clearing, securities lending, leveraged trade execution, and more. Such services are frequently utilized by large hedge funds and institutional investors.

Hidden Road currently clears $3 trillion annually across markets and serves over 300 institutional clients. The acquisition by Ripple will enable Hidden Road to use Ripple's balance sheet to significantly expand its operations and become the largest non-bank prime broker globally.

Following the completion of the deal, which is expected in the coming months, Ripple will become the only crypto company to own and operate a global multi-asset prime broker.

The acquisition also boosts the utility of Ripple's USD (RLUSD), as Hidden Road uses the stablecoin as collateral across its prime brokerage products. Ripple launched RLUSD, a stablecoin pegged to the U.S. dollar, last year in an effort to disrupt the market dominated by Tether and USD Coin.

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