Is Ripple Following a SoftBankInspired Acquisition Strategy?

Ripple has engaged in multiple acquisitions to establish control over essential transaction pathways, routing them through XRP and its stablecoin Ripple USD (RLUSD). These actions have prompted comparisons to SoftBank, a Japanese investment firm known for its aggressive investment strategy. For instance, Ripple’s $1.25 billion purchase of Hidden Road on April 8 enables the company to utilize RLUSD as collateral within its prime brokerage offerings. Hidden Road will also migrate its posttrade operations to the XRP Ledger, which underpins XRP and several of Ripple's institutional services.

Austin King, cofounder of Omni Network, who sold his startup to Ripple in 2019, describes Ripple’s approach as similar to SoftBank’s “acquisition strategy.” Unlike Google or Meta, which develop inhouse, SoftBank built its empire through investments, joint ventures, and acquisitions. Ripple appears to follow a similar model, but opinions vary on whether the comparison is accurate.

Ripple has gained over 300 institutional clients via the Hidden Road acquisition. The SoftBank model gained prominence through early investments like Yahoo and Alibaba, which later yielded significant returns, and through strategic moves into telecom and semiconductors. SoftBank’s broad portfolio created synergies across its investments, leveraging its sizable capital fund.

Ripple’s recent acquisitions focus on infrastructure rather than building from scratch, treating their investments as ecosystems rather than isolated projects. Both Ripple and SoftBank leverage capital—SoftBank with its Vision Fund and Ripple with its XRP holdings and cash reserves. As of March 31, Ripple held 4.56 billion XRP (approximately $11 billion), along with an additional 37.13 billion XRP in escrow, valued at around $89.8 billion.

These acquisitions have expanded XRP and RLUSD’s presence in traditional financial services, embedding them into custody, brokerage, and payment systems, thus creating a selfreinforcing cycle of usage. Ripple’s infrastructure allows XRP to act as a bridge asset between networks, while RLUSD offers a regulated, USDpegged unit of account preferred by institutions.

However, some critics argue that the SoftBank analogy is a stretch. SoftBank operated as a conglomerate with broad industry investments, whereas Ripple’s focus remains on financial services and blockchainbased payments. Ripple’s strategy involves acquiring infrastructure firms like Metaco and Standard Custody, and the recent addition of Hidden Road provides access to hundreds of institutional clients managing trillions of dollars annually.

This trend reflects a broader wave of mergers and acquisitions among US crypto firms, facilitated by a more favorable regulatory environment after years of legal challenges and banking restrictions. Ripple recently settled its lawsuit with the SEC, which had sued the company in December 2020, and industry leaders anticipate a more positive regulatory outlook.

Looking ahead, Ripple plans to continue acquisitions, potentially targeting large payment firms and stablecoin competitors. In April, Ripple’s bid to acquire Circle was rejected, but the company remains committed to highstakes deals, including absorbing stablecoin rivals. Experts believe that integrating stablecoins will significantly reshape US finance, though US regulation on stablecoins remains unresolved.