Crypto pundit X Finance Bull has drawn attention to Ripple’s new whitepaper, which highlights plans to use XRP for its prime brokerage offering. Ripple also recently announced plans to offer its institutional clients access to XRP derivatives on Coinbase Derivatives.
XRP’s Role In Ripple’s New Digital Prime Broker Model
In an X post, X Finance Bull stated that XRP isn’t just about payments now, as it is expanding into institutional trading infrastructure under Ripple’s Prime Broker model. He added that payments were just the start for the altcoin and that this is the next layer for XRP, a move which the pundit noted would create new demand. The pundit also indicated that this could boost XRP’s price in the long run, while admitting that the price could still stall in the short term.
The new Ripple whitepaper introduces the Prime Broker model, which aims to streamline the processes by which institutional clients access the crypto market. The crypto noted that the XRP Ledger (XRPL) can support early settlement within a Digital Prime Brokerage framework. This can happen by enabling on-chain credit lines that fund settlement ahead of the standard net settlement cycle, with funding costs applied explicitly and transparently.
Ripple stated that, under the Prime Broker model, the prime broker exposes on-chain credit lines to brokers and market makers. These credit lines allow participants to access liquidity before the standard net settlement cutoff. As the firm proposes bringing these institutional clients on-chain, it is worth noting that the XRP Ledger has activated the Permissioned DEX.
The Permissioned DEX on the XRP Ledger allows these institutional clients to trade in a regulated environment while also restricting who they trade with on the network through credential features, thereby putting adequate KYC and AML controls in place. Meanwhile, the payment company already boasts the infrastructure to implement this Prime Broker model, having acquired the Prime Brokerage platform Hidden Road (now Ripple Prime) last year.
Access To Crypto Derivatives
Ripple announced that it now offers its Ripple Prime clients access to crypto derivatives on Coinbase, which Nodal Clear will clear. These derivatives include Bitcoin, Ethereum, XRP, and Solana futures contracts. Coinbase also offers U.S. perpetual-style futures, which expands the offering for Ripple’s clients.
Furthermore, these futures contracts are regulated by the CFTC and are available 24/7, providing round-the-clock access for institutional clients. As a Futures Commission Merchant (FCM), Ripple Prime can facilitate these offerings without a third party. As a multi-asset brokerage platform, Ripple Prime continues to expand its crypto offerings. Last month, the company added support for Hyperliquid, providing institutional clients access to on-chain derivatives.
At the time of writing, the XRP price is trading at around $1.40, down in the last 24 hours, according to data from CoinMarketCap.
Featured image from iStock, chart from Tradingview.com
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