Ripple Expands 24/7 Stock and Commodity Trading, but Liquidity Remains a Challenge
Ripple is expanding its institutional brokerage business by allowing clients to trade contracts linked to stocks, commodities and currencies around the clock. However, limited liquidity during weekends could make it harder for large investors to use the service for major trades and risk management.
The service is offered through Ripple Prime, the brokerage formerly known as Hidden Road. Clients can now trade swaps linked to more than 100 markets, including equities, gold and oil, without directly purchasing the underlying assets. Trading firm Virtu is among the early users of the platform, according to Ripple's October 15 announcement.
The new products track perpetual futures available through Trade.xyz, which operates on Hyperliquid, a cryptocurrency derivatives exchange. Unlike traditional futures contracts, perpetual futures have no expiration date and can trade continuously, allowing investors to take positions even when conventional stock and commodity markets are closed.
Through Ripple Prime, clients can manage collateral and risk across their positions. They can also use Ripple's dollar-pegged RLUSD stablecoin to support their trades. The brokerage had already established a connection with Hyperliquid in February, building the groundwork for its latest expansion into around-the-clock trading.
However, continuous access does not guarantee that large orders can be executed at favorable prices. Investors still need enough buyers and sellers to trade without causing sharp price movements, particularly when traditional markets are closed and fresh pricing information is unavailable.
A recent episode highlighted these risks. Nearly $52 million in leveraged positions linked to chip stocks were liquidated within 10 minutes as selling pressure spread from Binance to Hyperliquid. Because the underlying shares were not trading, the contracts lacked fresh stock-market prices, exposing traders to sudden price changes and liquidation risks.
HSBC has described Ripple's launch as an incremental development rather than a major shift in financial markets. The bank's assessment pointed to a growing market that remains relatively small compared with the traditional financial markets its products track.
In the early stages, activity could be driven mainly by market makers, proprietary trading firms and hedge funds seeking to profit from price differences between related contracts. These strategies, known as basis trades, aim to capture gaps between the prices of connected financial instruments rather than establish long-term investment positions.
For institutional investors seeking to hedge their portfolios outside regular trading hours, the appeal will depend on whether the market develops enough depth to support large transactions. Without sufficient liquidity, executing a hedge could become expensive or expose a fund to unwanted price movements.
Ripple's longer-term prospects will also depend on how its offering compares with existing brokerage services. Lower costs, simpler execution and more efficient use of collateral could help attract institutions already active in traditional derivatives markets.
The company is entering a business that has historically been dominated by major banks and established financial firms. Ripple has also been generating revenue by financing leveraged stock positions, adding another source of activity to its brokerage operations.
The new swaps are currently offered under Ripple Prime's British Virgin Islands license, with the company planning to expand into additional jurisdictions. Ripple has identified Virtu as an early customer but has not disclosed trading volumes for the new products.
For now, the service gives institutions another way to access traditional asset markets through crypto trading infrastructure. Whether it becomes a widely used tool for institutional hedging will depend largely on liquidity, pricing and the ability to manage risk when conventional markets are closed.