Ripple’s newly acquired prime broker, Hidden Road, has launched cryptocurrency swaps for institutional investors in the United States.
The service allows US institutional clients to trade cash-settled over-the-counter (OTC) swaps across multiple major crypto assets, Hidden Road announced on May 28.
The new OTC swap product is offered by Hidden Road Partners, the company’s entity regulated by the United Kingdom’s Financial Conduct Authority (FCA).
The launch follows Ripple’s $1.25 billion Hidden Road acquisition deal announced in April, making the company behind XRP (XRP) one of the first crypto firms to own and operate a global, multi-asset prime broker.
Crypto OTC swaps limited in the US
Crypto OTC swaps are private, off-exchange transactions where two traders agree to exchange cryptocurrency assets directly, often involving large trades, so as not to disrupt the prices on exchanges.
According to Hidden Road’s global CEO, Michael Higgins, OTC swaps represent a significant portion of digital asset trading volumes globally, but they have been “largely unavailable to US institutions.”
“The United States digital asset market has long been underserved from a product standpoint,” Higgins said.
The executive did not provide any specific figures for estimated crypto OTC volumes globally. In January 2024, the crypto OTC infrastructure firm Finery Markets reported that institutional OTC volumes jumped 106% last year.
Cointelegraph approached Hidden Road for comment regarding the estimated OTC volumes globally and in the US, but had not received a response by the time of publication.
Rising institutional demand
In December 2024, Higgins highlighted a rising demand for institutional balance sheets from large institutions in an interview with Finance Magnates.
“Servicing them [institutional investors] across traditional finance and digital asset ecosystems that have already converged presents a really unique opportunity for us in the marketplace.”
Hidden Road’s OTC swap launch in the US marks one of the first products launched by the firm since the company entered a definitive agreement to be acquired by Ripple.
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Soon after the deal was announced, Hidden Road received a broker-dealer license from the Financial Industry Regulatory Authority, a private US corporation and self-regulatory organization regulating member brokerage firms and exchange markets.
Hidden Road is also known as one of the first companies to receive a Markets in Crypto-Assets (MiCA) license in Europe, immediately after the framework entered into full force on Dec. 30, 2024. The Dutch Authority for the Financial Markets announced the license acquisition on Jan. 30.
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