Ripple Prime opens 24/7 stock and commodity swaps

Ripple has expanded its institutional brokerage business into 24/7 stock and commodity derivatives trading, but HSBC has warned that limited market liquidity could prevent large investors from making extensive use of the service.

In an October 20 research note, HSBC digital assets research head Daragh Maher described the latest offering as an “evolutionary, not revolutionary” development, arguing that the market still needs sufficient trading depth before institutions can comfortably manage large positions outside conventional exchange hours.

The assessment followed Ripple’s October 15 announcement that Ripple Prime had started supporting perpetual swaps linked to more than 100 reference markets, covering equities, stock indexes, exchange traded funds, metals, energy products and foreign currencies.

Trading firm Virtu was among the institutional clients already using the service, according to Ripple, which has positioned the offering as another part of its expansion into traditional financial markets.

Ripple Prime brings traditional market exposure to weekend trading

Through the new service, institutional investors can trade swaps linked to perpetual futures listed by Trade.xyz on Hyperliquid, allowing them to take positions in assets such as stocks, gold and oil even when their underlying markets are closed.

Unlike conventional futures contracts, perpetual futures do not have a fixed expiration date. Their prices can continue moving throughout the weekend, allowing investors to respond to developments that occur outside regular market hours.

Ripple Prime acts as the counterparty to its clients and handles collateral management, financing and risk across supported positions. Institutions can use Ripple’s RLUSD stablecoin as collateral and combine margin requirements across different asset classes within the brokerage.

Michael Higgins, international CEO of Ripple Prime, said the service was designed for institutions looking to manage equity, commodity and currency exposure through digital trading infrastructure.

The brokerage had already integrated Hyperliquid trading in February, allowing institutional customers to access decentralized derivatives while managing their positions alongside traditional financial instruments.

By August, Ripple Prime had introduced its Delta One business, offering total return swaps tied to U.S. equities, indexes and digital assets. Its latest offering adds continuous trading access to a business that had already entered conventional equity derivatives.

The new swaps are currently offered through Ripple Prime’s British Virgin Islands licensed operation, with Ripple planning to make the service available in additional jurisdictions. The company has not disclosed trading volumes for the product.

HSBC issues warning

Despite the additional trading hours, HSBC questioned whether the market could accommodate the position sizes normally handled by major institutional investors.

According to Maher, the market for perpetual contracts linked to traditional assets has been growing quickly but remains relatively small compared with the underlying financial markets.

“The stronger case for the product comes once there is sufficient depth for investors to express views and adjust risk when conventional markets are closed,” Maher wrote.

A particular concern involves the availability of counterparties willing to absorb large trades without causing substantial price movements. Even with weekend trading, institutions still depend on sufficient liquidity to enter or exit positions at acceptable prices.

The risks became apparent during a recent weekend trading episode when nearly $52 million in leveraged chip stock positions were reportedly liquidated within 10 minutes as selling pressure spread from Binance to Hyperliquid.

Because the underlying shares were not trading at the time, perpetual contracts continued changing hands without fresh prices from the conventional stock market.

HSBC expects early participation to come primarily from market makers, proprietary trading firms and hedge funds pursuing basis trades, which involve taking advantage of pricing differences between related markets.

Maher said institutions looking to hedge longer term exposures may remain less active until liquidity improves.

The bank identified trading costs, operational simplicity and efficient collateral management as important factors in determining whether Ripple Prime can compete with established brokerage providers.

Ripple has already entered leveraged ETF financing, including swap arrangements tied to investment products that track individual stocks. Its brokerage has been moving into financing activities traditionally handled by major investment banks.

Could Ripple Prime’s expansion benefit XRP?

While Ripple Prime’s institutional business could eventually create opportunities for XRP, the latest derivatives offering does not establish a direct source of demand for the cryptocurrency.

According to Ripple’s announcement, institutions can use RLUSD as collateral for the new swaps, while the underlying contracts trade through Hyperliquid. XRP has not been identified as a required settlement or collateral asset for the service.

As crypto.news previously examined in its analysis of XRP usage, Ripple Prime’s substantial clearing activity does not necessarily translate into equivalent transaction volumes on the XRP Ledger or direct purchases of XRP.

However, an opportunity for the token could emerge if Ripple eventually incorporates XRP into institutional collateral transfers or settlement arrangements connected to its brokerage. As of publication time, the company has not announced such an integration for these particular swaps.