“Hidden Road Has 20x More Balance Sheet Demand Than Supply; the Ripple Deal Solves This”

“We are fortunate to have 20 times more demand for balance sheet than supply at Hidden Road,” Michael Higgins, International CEO of Hidden Road, told FinanceMagnates.com following the $1.25 billion acquisition by Ripple. “By partnering with Ripple,” he added, “we can immediately solve the supply and demand issue for Hidden Road’s existing clients, expand our capacity to service our pipeline, and continue to scale.”

The acquisition, according to him was also “pretty organic” as “Ripple was well known to Hidden Road as a customer. Hidden Road was known to members of the Ripple management team. There was a natural relationship between our firms.”

“A Natural Fit”

Ripple acquired Hidden Road earlier this month in one of the largest deals in the crypto industry. The $1.25 billion transaction will be completed with a mix of cash, XRP tokens and equity, and is expected to close in the coming months. The deal also came in the backdrop when “all participants in digital assets are aiming to institutionalise the market infrastructure,” according to Higgins. “The combination of Ripple and Hidden Road was a natural fit.”

🚨 Here is the full speech of @MonicaLongSF about @Ripple acquiring Hidden Road for $1.25B👇
How RLUSD will be used ?!
Will XRP be involved in this deal ?
Is volume on the XRPL going to explode ?
Check and repost the video guys 👇 pic.twitter.com/knOQ1WP7aM

— Arthur (@XrpArthur) April 8, 2025

Founded in 2018, Hidden Road offers cryptocurrency liquidity through over-the-counter (OTC) prime brokerage. “Hidden Road, in traditional markets, provides its customers with clearing and prime services—across foreign exchange, fixed income, swaps, and listed derivatives,” Higgins explained.

He described the link between traditional and digital markets: “You trade Bitcoin against dollars. You trade Bitcoin against euro. You trade Bitcoin against yen. That has an FX component and a digital asset component. This is evidence of the merging of traditional and digital markets.”

According to recent data, Hidden Road clears $3 trillion annually across all markets and serves over 300 major institutional clients. With Ripple’s backing, the broker plans to grow its capacity to serve even more clients in the future.

“Tokenising real-world assets on blockchains like the XRP Ledger has the potential to make traditional markets more efficient,” Higgins added.

You may also like: Ripple-Hidden Road Deal: Crypto Prime Brokers Leave Banks Behind

“More Capacity for Institutional Clients”

Ripple's acquisition of Hidden Road focused not only on scale but also on product synergy. Hidden Road plans to use Ripple’s RLUSD stablecoin as collateral within its brokerage system and is also looking into using the XRP Ledger to improve settlement efficiency. The aim is to speed up the use of Ripple’s key technologies among major institutional users.

“Providing clients with a stablecoin that operates 24/7 helps make markets more operationally and capital efficient,” added Higgins.

Furthermore, once the deal is complete, Hidden Road will migrate its post-trade activity to XRPL to streamline operations and reduce costs. On Ripple’s side, it sees the opportunity to optimise costs and liquidity in its cross-border payments solution, Ripple Payments, while also offering secure digital asset custody services to Hidden Road’s clients.

Another highlight of the deal was Ripple’s commitment to “inject billions of dollars of capital” to provide immediate scale and meet the demand for Hidden Road’s prime brokerage, clearing and financing platform. This would also address the demand abundance situation for Hidden Road, which, according to Higgins, “is a good problem to have and speaks to the success of our prime brokerage, clearing and financing platform.”

“Ripple enables Hidden Road to provide more capacity to institutional clients,” Higgins added. “The worlds of traditional markets and digital assets have already merged. Now you have a prime broker that can offer access to digital assets and compete in traditional markets—and the only one who can service both at scale: Hidden Road.”

“We will be able to support some of the largest institutions in the world—hedge funds, regional banks, asset managers—across asset classes and product types,” he explained. “Within digital assets, we believe it will bring the biggest names into the space through a regulated, well-capitalised entity.”

“The Timing Was Right”

The acquisition came as the crypto regulatory environment in the US was changing. Donald Trump, who declared himself the first Bitcoin President during his campaign, appointed a crypto-friendly Chair to the Securities and Exchange Commission, the agency that once went after Ripple in a high-profile lawsuit. Ripple’s CEO, Brad Garlinghouse, confirmed that the regulator had decided to end enforcement actions against the company.

Read more: “It's Over,” Ripple CEO Garlinghouse Confirms End of SEC Case

“The tailwind from Trump’s regulatory initiatives has created an opportunity for digital assets to grow with US support,” Higgins said. “Prime and clearing needed innovation. We set out to do that years ago, and part of taking that next step was having a strong balance sheet and a partner to scale with. Ripple is certainly providing that. We believe it brings trust and financial strength to the ecosystem—across assets and products. It’s exciting.”

“We set out to do three things: rebuild the prime and clearing infrastructure, obtain global regulation, and inject significant capital into the business,” he added. “We became a more mature business with a strong institutional client base over time. With the right partner—regulatory-first, technology- and product-focused—it felt natural to combine with Ripple. The timing was right.”

Another point highlighted by Higgins was “being regulatory compliant.” He said, “We both maintain strong regulatory and compliance frameworks that allow us to operate in the jurisdictions we do.” Indeed, days after the acquisition announcement, Hidden Road secured a broker-dealer licence in the United States.

“The goal was, and remains, to become the preeminent non-bank, multi-asset prime and clearing firm. Technology, regulation, and balance sheet—that’s what it takes,” Higgins on the long-term vision of Hidden Road. “It’s still very early on.”