In a significant move bridging digital assets and traditional finance, Ripple-owned Hidden Road has obtained a broker-dealer license from the Financial Industry Regulatory Authority (FINRA). This regulatory green light arrives merely days after Ripple finalized its $1.25 billion acquisition of the non-bank brokerage firm, highlighting a rapid push towards crypto institutional adoption.
The newly acquired FINRA license empowers Hidden Road to significantly broaden its reach within the institutional market. The firm can now extend its prime brokerage, clearing, and financing operations across fixed-income assets to a more diverse group of sophisticated investors.
Hidden Road President Noel Kimmel indicated the license unlocks access to a considerably larger customer base, positioning the firm for substantial growth under Ripple’s ownership.
This development follows closely on the heels of Ripple’s landmark $1.25 billion purchase of Hidden Road. The integration plan involves leveraging Ripple’s native blockchain technology and financial tools.
Hidden Road is set to utilize Ripple’s RLUSD stablecoin as a collateral option for its prime brokerage services. Furthermore, the firm will migrate its post-trade settlement processes onto the XRP Ledger, aiming for enhanced efficiency.
Ripple CEO Brad Garlinghouse described the acquisition as a pivotal moment, creating a unique pathway for crypto markets to connect with established traditional financial systems, and enabling capital flow in both directions. Hidden Road’s substantial existing operation, clearing over $3 trillion annually for more than 300 institutions, presents a significant volume that Ripple intends to integrate with the XRP Ledger.
The synergy is expected to benefit Hidden Road by enabling faster, more cost-effective clearing services. Utilizing the XRP Ledger and RLUSD for settlement and collateral aims to drastically reduce settlement times compared to traditional <24-hour fiat rails, boosting the firm’s competitive edge.
Looking forward, Hidden Road intends to introduce new offerings later this year, including fixed-income repurchase agreements and global funding services. These expansions will be supported by Ripple’s financial backing and resources, further solidifying the combined entity’s position at the intersection of crypto and TradFi.