TLDR
- Ripple Prime now provides swap financing to leveraged ETFs, a business long handled by big banks.
- The Tradr 2X Long SNDK Daily ETF pays Ripple the overnight bank funding rate plus 4 percentage points.
- XRP traded near $1.40, down more than 5% in the past 24 hours.
- Ripple built its brokerage through the $1.25 billion Hidden Road acquisition, completed in October 2025.
- Ripple Prime raised $275 million in August and expanded its deal with Brevan Howard on Oct. 6.
Ripple has entered the business of financing leveraged exchange-traded funds through its brokerage arm, Ripple Prime. The Wall Street Journal reported the move on Oct. 7.
This type of swap financing has long been handled by major banks and securities firms. It earns steady fees for the firms that provide it.
XRP showed little reaction to the news. The token traded near $1.40 at the time of writing, down more than 5% in the past 24 hours.
Technical indicators leaned bearish. There were seven sell signals and five buy signals.
How Ripple Prime’s ETF Financing Works
Leveraged ETFs aim to deliver two or three times the daily return of a stock or index. Their managers often use total return swaps instead of buying the full amount of shares.
A broker sells the fund that swap for a fee. The broker then hedges its exposure by buying stocks or other derivatives.
One of Ripple’s clients is the Tradr 2X Long SNDK Daily ETF, which tracks twice the daily move of Sandisk shares. According to a regulatory filing, it pays Ripple the overnight bank funding rate plus 4 percentage points.
As of Tuesday, that fee worked out to roughly 8% of the fund’s assets on an annualized basis. The cost comes from the ETF’s investors and is separate from the fund’s management fee.
According to Morningstar Direct, there are 593 leveraged ETFs in the U.S. managing more than $256 billion. Of these, 426 are single-stock funds.
“It’s definitely a growing and meaningful part of our business,” said Noel Kimmel, president of Ripple Prime.
Nonbank firms such as Jane Street and Clear Street are also active in this market. Banks face stricter rules on risk, and many new ETF issuers lack long-standing ties with banks.
Hidden Road Deal and New Funding
Ripple entered prime brokerage through its $1.25 billion acquisition of Hidden Road. The deal was announced in April 2025 and closed in October 2025, when the firm became Ripple Prime.
In August 2026, Ripple Prime launched a Delta One business offering total return swaps on U.S. stocks, indexes and digital assets. The leveraged ETF financing uses the same type of instrument.
The brokerage raised $275 million in August through senior unsecured notes rated BBB by KBRA. This followed a $200 million financing facility from Neuberger Berman in May.
Ripple Prime serves more than 300 institutional clients. It reported holding over $1 billion in regulatory net capital.
The reported ETF financing deals have not been tied to XRP or Ripple’s RLUSD stablecoin.
On Oct. 6, Ripple Prime expanded its agreement with Brevan Howard, which manages about $35 billion. Ripple will provide the hedge fund with prime brokerage, clearing and financing across traditional and digital markets.
The post XRP (XRP) Price: Ripple Takes On Banks in $256 Billion Leveraged ETF Market appeared first on Blockonomi.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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