Ripple Invades Traditional Finance with Delta One Trading Desk

Ripple has launched a Delta One trading desk within its prime brokerage arm, Ripple Prime. This move allows institutional investors to bet on price movements of US-listed stocks, major indices, and cryptocurrencies without directly owning them.

The desk offers total return swaps (TRS), which allow clients to collect the full return of an asset without actually owning it. The stakes are high, as rogue traders at Société Générale and UBS lost billions on Delta One books in 2008 and 2011.

Ripple claims a clean-hands edge over traditional banks like JPMorgan, which market Delta One hedging tools. Ripple Prime only clears and finances client trades, unlike the bank desks that sit beside in-house trading units.

The desk is not an XRP product, and clients can use various assets, including Bitcoin, Apple stock, or XRP, within a swap. The company's war chest is growing, with over $1 billion in regulatory net capital and recent investments valuing Ripple at $40 billion.