Ripple Prime earns financing fees by providing institutional funds with leveraged stock exposure through total return swaps. In one example reported by CoinDesk on Oct. 8, 2026, the Tradr 2X Long SNDK Daily ETF pays Ripple the overnight bank funding rate plus four percentage points on its swap exposure—estimated at roughly 8% annualized at rates prevailing that day. That is a reported deal, not a standard price for all Ripple financing.
How Ripple makes money from a leveraged stock position
Ripple Prime is an institutional, non-bank prime broker, not a retail brokerage or a bank. It can provide funds with exposure to a stock or index through a total return swap: the fund receives the underlying asset’s return under the contract without directly buying the full exposure. The broker charges a financing fee for providing that exposure and manages its own risk through hedges or other trades. Ripple describes its Delta One products as typically using this kind of swap: Ripple Prime product information.
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The reported example involves the Tradr 2X Long SNDK Daily ETF, which targets twice Sandisk stock’s daily move. Rather than buying twice its assets’ worth of Sandisk shares, the fund uses a swap. CoinDesk reported that the financing rate is the overnight bank funding rate plus four percentage points, charged on swap exposure. Its roughly 8% annualized estimate reflected rates prevailing on Oct. 8, 2026; it is not a guaranteed, current, or universal Ripple rate. The financing charge is also separate from the ETF’s management fee. CoinDesk’s Oct. 8, 2026 report.
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What the prime broker provides
Prime brokerage combines services that institutional clients might otherwise arrange with multiple counterparties. Ripple says Ripple Prime provides trading access, clearing, financing, and risk management across digital assets, foreign exchange, listed derivatives, swaps, and fixed income. It also describes portfolio and risk-based margin financing, including cross-margining that can let clients use a shared collateral pool across asset classes. These are descriptions of Ripple’s offering, not independently measured evidence of capital savings. Ripple Prime product information.
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The distinction matters: the stock exposure in the cited ETF transaction is not evidence that the trade is powered by XRP or settled on the XRP Ledger. CoinDesk reported that Ripple has not disclosed what share of this financing activity uses XRP or XRPL, or how much revenue leveraged ETF financing generates specifically. CoinDesk’s report.
Why a non-bank is competing with banks
Banks have historically supplied much of the financing behind leveraged investment positions. CoinDesk reported that tighter capital and risk requirements have opened room for non-bank providers, including Ripple Prime, Jane Street, and Clear Street. The comparison is about a financing function; it does not make Ripple a bank. Ripple itself says its non-bank structure avoids bank capital constraints, a company framing rather than an independent assessment of its regulatory or financial advantages. CoinDesk’s report.
Ripple entered prime brokerage by acquiring Hidden Road, a multi-asset prime brokerage, for $1.25 billion. The acquisition closed in October 2025, and the business now operates as Ripple Prime, according to CoinDesk. Ripple’s broader institutional activity includes U.S. OTC spot trading and cross-margining digital-asset spot holdings with OTC swaps and CME futures and options, announced in November 2025. That context describes the platform’s reach; it does not establish that the Sandisk ETF swap uses crypto assets. CoinDesk; Ripple’s Nov. 3, 2025 announcement.
What the reported growth figures do—and do not—show
In May 2026, Ripple announced a debt facility of up to $200 million from funds managed by Neuberger Specialty Finance, saying the proceeds were intended to expand client financing capacity. Ripple also said Ripple Prime revenue had tripled year over year since the 2025 acquisition. The facility figure is its maximum capacity, not evidence that the full amount was drawn, and the revenue claim covers Ripple Prime overall—not leveraged ETF financing alone. Ripple’s May 11, 2026 announcement.
A separate Ripple, DBS, and Franklin Templeton announcement described an MOU involving tokenised money-market funds and RLUSD. DBS said it would explore allowing sgBENJI fund units to serve as collateral for bank credit or third-party lending. That is an announced exploratory use case, not evidence that leveraged stock financing is on-chain or that the contemplated lending is broadly available. Ripple’s Sept. 18, 2025 announcement.
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CoinDesk, citing Morningstar Direct data, reported 593 leveraged ETFs holding more than $256 billion, including 426 funds tracking individual stocks. Those figures indicate a substantial market for leveraged exposure; they are not Ripple’s client count, assets financed, or revenue. CoinDesk’s report.
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Leveraged ETFs reset their exposure daily, so their aim is generally a multiple of an underlying asset’s return over a day, not a promise to deliver that multiple over a longer holding period. Sharp moves can create losses and leave a financing firm exposed if a fund’s assets do not cover what it owes. The specific collateral requirements, margin-call process, and close-out terms for the reported Sandisk ETF swap have not been disclosed in the cited coverage. For an institutional client, those contract terms—alongside the financing spread, collateral eligibility, cross-margin rules, counterparty strength, and liquidity—matter as much as the headline rate.
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What is still undisclosed
- Ripple has not disclosed the revenue attributable specifically to leveraged ETF financing.
- The share of that activity, if any, using XRP or the XRP Ledger has not been disclosed.
- The public reporting does not provide the Sandisk swap’s collateral, margin-call, or close-out terms.
- The available sources do not provide equivalent contract pricing or terms for named bank competitors, so they do not support a like-for-like price comparison.
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