Ripple has expanded its institutional brokerage business into leveraged exchange-traded fund financing, moving into a market that has traditionally been dominated by major Wall Street banks.
Ripple Prime is providing financing and stock swap arrangements to funds that seek to deliver multiple times the daily performance of individual stocks and market indexes.
According to an Oct. 7 report by the Wall Street Journal, one of the funds using Ripple Prime is the Tradr 2X Long SNDK Daily ETF, which aims to deliver twice the daily performance of Sandisk shares.
The fund pays Ripple a financing rate based on the overnight bank funding rate plus four percentage points.
The arrangement gives Ripple a new source of revenue by charging financing fees to funds that use derivatives to create leveraged exposure to publicly traded stocks.
Leveraged ETFs typically target two or three times the daily return of an underlying stock or index. Instead of buying enough shares to create that exposure directly, fund managers can use derivatives such as total return swaps.
Under a swap, the brokerage provides the fund with exposure to the returns of an underlying asset. In return, the fund pays financing costs and other fees agreed upon in the contract.
Ripple Prime can manage its own exposure through stock purchases or other financial transactions while providing the economic exposure required by the ETF.
The Sandisk ETF provides a specific example of how Ripple is earning money from this business. Its reported financing rate is four percentage points above the overnight bank funding benchmark, although rates can vary depending on the asset and terms of each agreement.
Leveraged ETFs also reset their exposure each day. Because of daily compounding and market volatility, an ETF targeting twice the daily return of a stock may not produce exactly twice the stock’s overall return over a longer period.
Ripple Prime is providing the financing and brokerage infrastructure rather than managing the ETFs themselves. The funds remain responsible for their own investment strategies.
Ripple entered this part of the financial market after acquiring Hidden Road for $1.25 billion.
Ripple announced the acquisition in April 2025 and completed it later that year. Hidden Road was then renamed Ripple Prime, giving Ripple an established institutional brokerage business covering digital assets, foreign exchange, derivatives and fixed income.
Hidden Road had already built a business providing trading, clearing and financing services to institutional clients. Ripple said the operation had handled around $3 trillion in annual clearing activity before the acquisition and later reported significant growth.
Ripple Prime has since expanded further into traditional financial markets.
In August 2026, the company launched its Delta One business, offering total return swaps linked to U.S.-listed stocks, market indexes and digital assets.
These products allow institutional investors to gain economic exposure to an asset without directly owning it. The brokerage handles the swap, financing and related collateral requirements.
The new leveraged ETF financing business uses similar derivative structures.
Ripple Prime has also raised additional capital to support its growing brokerage operations.
In August, the company raised $275 million through a private placement of senior unsecured notes sold to institutional investors. Ripple said the money would be used for working capital and general corporate purposes as its U.S. brokerage business expands.
KBRA gave the notes a BBB investment-grade rating, while Piper Sandler acted as the lead placement agent.
The financing came after Ripple secured a separate $200 million facility in May from funds managed by Neuberger Berman. That facility was designed to provide additional lending capacity based on institutional client demand.
Together, the two arrangements give Ripple Prime access to as much as $475 million in financing through different structures.
Ripple Prime currently serves more than 300 institutional clients, including hedge funds, proprietary trading firms and liquidity providers. Its services include clearing, settlement, financing and cross-margining across several markets.
Ripple said in its August Delta One announcement that Ripple Prime had more than $1 billion in regulatory net capital.
The company has also been expanding its relationships with major institutional investors.
On Oct. 6, Ripple Prime expanded its agreement with Brevan Howard, a hedge fund manager with about $35 billion in assets. The agreement covers prime brokerage, clearing and financing across traditional and digital markets.
Brevan Howard’s investment teams can use Ripple Prime to access multiple asset classes through a single brokerage platform.
The relationship between the companies began before the latest agreement. Funds connected to Brevan Howard participated in Ripple’s $500 million strategic investment round in November 2025, when Ripple was valued at about $40 billion.
Ripple Prime has also added RLUSD, Ripple’s dollar-backed stablecoin, to its institutional services. Eligible clients can use RLUSD as collateral, although the reported leveraged ETF financing arrangements have not been identified as using XRP or RLUSD.
Ripple has previously said it plans to move some post-trade activities onto the XRP Ledger, but there is no indication that the Sandisk ETF financing deal currently uses the XRP Ledger.
Ripple’s expansion into leveraged ETF financing shows how far its business has moved beyond payments and cryptocurrency.
The company is increasingly building a broader institutional financial platform that combines digital assets with traditional markets, including equities, derivatives, financing and clearing.
