Key Notes
- Ripple is emerging as a competitor to major banks in swap financing for leveraged ETFs, according to the Wall Street Journal.
- Ripple Prime’s Delta One business offers equity and digital-asset swaps through a single counterparty with cross-margining across eligible exposures.
- A $200 million borrowing facility and $275 million notes placement support the brokerage’s expansion, alongside a broader Brevan Howard services agreement.
Ripple is becoming a competitor to Wall Street banks in swap financing for leveraged exchange-traded funds, the Wall Street Journal reported on October 7, highlighting the payments company’s expansion into a business traditionally dominated by large banks.
The push builds on Ripple Prime, the institutional brokerage created after Ripple acquired Hidden Road. Its growing product range connects conventional financial markets with digital assets, giving professional investors access to clearing, financing and derivatives through one platform.
Ripple launched a Delta One business in August, offering total return swaps on US-listed equities, indices and digital assets. The launch supplied a concrete route into equity derivatives, alongside the foreign-exchange, fixed-income and crypto services already available through Ripple Prime.
Why Leveraged ETFs Need Swap Financing
Leveraged ETFs seek to deliver a multiple of a benchmark’s daily performance. A fund targeting twice an index’s daily return, for example, needs exposure beyond the value of its investors’ cash. Derivatives are one way to obtain that exposure without simply buying an equivalent amount of shares.
The SEC’s investor-education office explains that these funds use swaps, futures and other instruments to pursue their objectives. Most reset daily, so returns over longer periods can diverge sharply from the stated daily multiple.
In a total return swap, an investor can receive the economic return of a stock or index through a contract with a counterparty, rather than owning the underlying shares directly. Financing and collateral arrangements become part of providing that exposure. For Ripple Prime, this places the business inside the infrastructure supporting investment products.
Hidden Road Opened the Door
Ripple agreed to acquire Hidden Road for $1.25 billion in April 2025 and completed the transaction that October. The acquisition brought an established non-bank prime broker into a company better known for cross-border payments and XRP-related infrastructure.
At the April announcement, Ripple said Hidden Road cleared about $3 trillion annually across markets and served more than 300 institutional customers. Those were historical operating figures for Hidden Road, rather than current ETF-financing volumes or assets held by Ripple.
The Delta One launch extended that foundation. Ripple says clients can maintain one counterparty relationship and cross-margin eligible exposures across asset classes around the clock. In practice, cross-margining lets a broker assess positions together when determining collateral requirements, subject to the relevant risk controls.
Ripple also presents its focus on clearing and financing, without a parallel proprietary-trading business, as a competitive distinction. That is the company’s description of its model. CoinScreamer previously covered the equity derivatives expansion when it launched.
Capital Supports the Brokerage Push
Financing institutional positions requires access to funding as well as trading technology. Ripple Prime has added two sources of debt financing in 2026 as it expands its client business.
In May, it secured a facility allowing it to draw up to $200 million from funds managed by Neuberger Specialty Finance. Ripple said the arrangement would increase lending capacity for clients operating in traditional and digital markets. The facility’s maximum size does not establish how much has been drawn.
Ripple Prime then closed a $275 million senior unsecured notes placement in August. The company designated the proceeds for working capital and general corporate purposes within its regulated business. KBRA assigned the offering a BBB investment-grade rating, according to Ripple’s announcement.
The two arrangements serve different funding needs: one provides borrowing capacity, while the other raised capital through issued notes. Neither amount measures revenue, assets under management or the size of Ripple’s leveraged ETF business.
Brevan Howard Adds an Institutional Client
The expansion also has a recent client example. Ripple and Brevan Howard announced on October 6 that Ripple Prime would provide the manager’s funds with multi-asset prime brokerage, clearing and financing.
Funds managed by Brevan Howard affiliates also participated in Ripple’s $500 million strategic investment in 2025. The new service mandate therefore extends an existing relationship between the manager and the infrastructure provider.
Brevan Howard manages about $35 billion, according to the announcement. That is the manager’s overall asset base, not a commitment to route $35 billion through Ripple Prime. The companies did not disclose contract values, specific allocations or which funds would use individual services.
The expanded agreement illustrates Ripple’s intended customer base: professional managers needing access to several markets and financing arrangements within the same relationship.
Where XRP and RLUSD Fit
Ripple’s broader institutional strategy includes its dollar stablecoin, RLUSD. At the Hidden Road acquisition closing in October 2025, the company said RLUSD was already being used as collateral for some prime brokerage products and that certain derivatives customers held balances in the token.
That disclosure does not establish that every equity swap or leveraged ETF financing arrangement uses RLUSD, XRP or the XRP Ledger. The confirmed development is a wider brokerage offering with traditional-market clients. How much of that activity ultimately moves onto blockchain infrastructure will depend on the products and arrangements Ripple and its customers implement.
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