Ripple deserves great credit for taking that leap by acquiring Hidden Road. The largest of these, a major provider of clearing, financing and brokerage services, is $1.25 billion. This smart move is designed to create a clear path between legacy finance and the growing digital asset economy. The acquisition will embrace RLUSD as the first cross-market stablecoin, enabling cross-margining between crypto and traditional markets. This acquisition signals a big step toward decentralization for Ripple. Specifically, it furthers their mission to improve institutional access to digital assets and expand the capabilities of the XRP Ledger (XRPL) blockchain.
Enhancing Institutional Access to Digital Assets
Ripple’s acquisition of Hidden Road goes a long way in boosting institutional access to digital assets. Ripple has long counted Hidden Road as a close partner and client. They have deep backgrounds in clearing, financing and brokerage services over a wide range of asset classes. The integration of Hidden Road's platform with Ripple's blockchain technology will provide institutional investors with a seamless and secure way to engage with digital assets.
It would make RLUSD the first cross-stablecoin to enable cross-margining between crypto and legacy markets. This new inclusion is a key part of our overall strategy. All of a sudden, institutions were better able to control their risk. As a result, they are able to use more digital and traditional assets as collateral for their trading activities, increasing efficiency while doing so.
"Ripple’s resources and network put us in a good position to scale quickly, enter new markets, and provide customers a smooth mix of digital and conventional asset exposure." - Marc Asch, Hidden Road CEO
Migration to XRP Ledger (XRPL)
As part of the acquisition, Hidden Road will move a majority of its post-trade processes to Ripple’s XRP Ledger (XRPL). This implementation will make XRPL more useful for institutional DeFi and crypto-native clearing. The migration will harness the power of XRP and RLUSD to deliver financial flows that are not only quicker, but far less expensive.
The XRP Ledger offers remarkable speed and scalability. Its nearly-zero transaction costs make it the ideal launching pad for an array of institutional-grade financial services. Ripple has transferred Hidden Road’s post-trade processes infrastructure to XRPL. This initiative is designed to represent the potential of blockchain technology to completely change the traditional, outdated financial industry.
This new transition aligns clearly with Ripple’s vision as described above. The ultimate goal of the initiative is to broaden XRP’s use cases, having it become a cornerstone of the future global financial infrastructure. The integration of Hidden Road's services with XRPL will further solidify Ripple's position as a leader in the blockchain and cryptocurrency space.
Ripple's Vision for Institutional Crypto Adoption
Ripple's CEO, Brad Garlinghouse, emphasized the company's belief that institutional adoption of crypto is accelerating. He stated that the acquisition of Hidden Road will enable Ripple to meet the demands of traditional banking while opening up new avenues for expansion in the digital asset market.
"We’re reaching an inflection point where institutional use of crypto is gathering speed. This purchase allows Ripple to finally provide the volume and quality of services conventional banking demands while opening the next stage of expansion for the digital asset market." - Brad Garlinghouse, Ripple's CEO
The acquisition provides Ripple with complete ownership and operational control over a leading provider of clearing, financing, and brokerage services. Ripple’s strategic acquisition would further enhance Ripple’s value proposition in the institutional crypto space. Secondly, this initiative will speed up the adoption of digital assets.
Hidden Road's extensive regulatory licenses, numbering over 60 across various jurisdictions, and its decade-long expertise in digital asset compliance, settlement, and infrastructure were key factors in Ripple's decision to acquire the company. This acquisition is a major step forward for institutions’ broader acceptance of crypto-native infrastructure. It uses existing assets like XRP and RLUSD to facilitate real-time, low-cost transactions between any currencies.
