Crypto agency Ripple to purchase prime dealer Hidden Highway for $1.25 billion

Ripple on Tuesday stated that it is agreed to purchase prime brokerage agency Hidden Highway for $1.25 billion, within the crypto startup’s greatest acquisition up to now.

Based in 2018, Hidden Highway presents clearing, prime brokerage and financing providers throughout international change, digital property, derivatives, swaps and stuck earnings. It presently clears greater than $3 trillion yearly throughout markets with over 300 institutional clients, together with hedge funds.

The acquisition marks one of many largest offers within the digital asset area up to now, topping Stripe’s $1.1 billion February deal to purchase Bridge, a platform that makes it simpler for companies to take fee by way of stablecoins.

Ripple CEO Brad Garlinghouse stated the deal got here collectively after Hidden Highway discovered itself “constrained” in progress on account of stability sheet limitations and commenced on the lookout for exterior capital.

“This can be a massive deal for Ripple — but in addition an enormous deal for the business,” Garlinghouse instructed CNBC by telephone.”As all the crypto business will get extra into conventional finance, we want prime tier infrastructure to have the ability to help the monetary establishments that need to are available.”

Ripple, which was final valued at $11.3 billion in a 2024 share buyback, stated that when the transaction closes the plan is for Hidden Highway to make use of its RLUSD stablecoin — which launched in December — as collateral throughout the corporate’s prime brokerage merchandise.

“Collateral is vital” within the prime brokerage providers business, Garlinghouse stated. Hedge funds and different institutional traders usually require collateral o take out loans or complicated buying and selling positions, such as short selling.

Ripple’s acquisition of Hidden Highway stays topic to crucial regulatory approvals. Garlinghouse instructed CNBC he expects the deal to shut no later than the third quarter of 2025.

Ripple scored a serious victory final month, when the U.S. Securities and Trade Commissioned dropped a protracted legal case against the company that accused it of conducting an unlawful securities providing.

The crypto business has been typically boosted by the re-election of Donald Trump as U.S. president, who has touted the advantages of crypto and promised favorable insurance policies for the business.

Requested whether or not this extra pro-crypto regulatory atmosphere gave Ripple added impetus for its prime brokerage takeover, Garlinghouse stated that “offers like this make much more sense when you will have a supportive regulatory atmosphere — versus the open warfare authorized ways.”

The crypto chief has beforehand been essential of the SEC and its former chief Gary Gensler, who oversaw aggressive authorized actions towards a number of crypto companies, together with Ripple.