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Ripple launches crypto storage services for banks in bid to diversify

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1 month ago

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U.S. blockchain startup Ripple made a major foray into crypto custody on Thursday, launching new services aimed at helping banks and financial technology firms to store digital assets on behalf of clients.

The San Francisco-based company told CNBC it is debuting a slew of features to enable its banking and fintech clientele to keep and maintain digital tokens — as part of a broader push into custody, a nascent business for Ripple under its recently formed Ripple Custody division.

These features include pre-configured operational and policy settings, integration with Ripple’s XRP Ledger blockchain platform, monitoring of anti-money laundering risks to maintain compliance, and a new user interface that’s easier to use and engage.

The move will help Ripple, which is primarily known for the XRP cryptocurrency and its RippleNet platform, to diversify beyond its core payment settlement business. RippleNet is a messaging platform based on blockchain — the technology that underpins cryptocurrencies such as bitcoin — which lets banks share updates on the status of money movements in a global, distributed network.

Thursday’s development marks Ripple’s first significant move to consolidate its custody products under one brand, Ripple Custody, and take on a slew of companies that already offer products and services in this space, such as Coinbase, Gemini, and Fireblocks.

Custodian

Custody is a nascent but fast-growing space within the digital asset space. Custodians play a key role in the crypto market, helping clients safeguard private keys, which are the alphanumeric codes required to unlock access to digital assets and authorize transactions.

Custodians don’t just store crypto. They also help with payments and settlements, trading, and ensuring regulatory compliance with global laws governing digital currencies. The crypto custody market is forecast to reach at least $16 trillion by 2030, according to the Boston Consulting Group.

Ripple said that custody is one of the fastest-growing areas for the startup, with Ripple Custody posting customer growth of over 250% year-over-year growth this year and operating in seven countries. It counts the likes of HSBC, the Swiss arm of BBVA, Societe Generale and DBS as clients.

Gambling that a growing number of real-world assets will become tradable as digital tokens in the future, Ripple said it will allow customers of its custody services to tokenize real-world assets — think fiat currencies, commodities like gold and oil or real estate — by using XRP Ledger.

Ripple said that the integration with its XRP Ledger tech would give firms access to its own native decentralized exchange, a platform that helps match buyers and sellers of a range of digital assets without any middlemen involved for faster, low-fee trading.

“With new features, Ripple Custody is expanding its capabilities to better serve high-growth crypto and fintech businesses with secure and scalable digital asset custody,” Aaron Slettehaugh, senior vice president of product at Ripple, said in a statement shared with CNBC on Thursday.

Last year, Ripple acquired Metaco, a firm that helps other entities store and manage their crypto, in a bid to boost its nascent crypto custody business. The company this year also acquired Standard Custody & Trust Company, another crypto custody firm, to further bolster its efforts.

Ripple’s diversification bid comes at a tenuous time for XRP. Last week, the price of the XRP cryptocurrency tumbled sharply after the U.S. Securities and Exchange Commission filed to appeal a 2023 court ruling that the token should not be considered a security when sold to retail investors.

As the largest holder of XRP coins, Ripple has long battled the SEC over allegations that it sold the cryptocurrency in an illegal securities offering. Ripple denies the cryptocurrency should be considered a security.

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Morgan Stanley picks China stocks to ride out a worst-case scenario in U.S. tensions

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16 hours ago

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November 17, 2024

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Elon Musk endorses Trump’s transition co-chair Howard Lutnick for Treasury secretary

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1 day ago

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November 16, 2024

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Elon Musk at the tenth Breakthrough Prize ceremony held at the Academy Museum of Motion Pictures on April 13, 2024 in Los Angeles, California.

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On Saturday, Elon Musk shared who he is endorsing for Treasury secretary on X, a cabinet position President-elect Donald Trump has yet to announce his preference to fill.

Musk wrote that Howard Lutnick, Trump-Vance transition co-chair and CEO and chairman of Cantor Fitzgerald, BGC Group and Newmark Group chairman, will “actually enact change.”

Lutnick and Key Square Group founder and CEO Scott Bessent are reportedly top picks to run the Treasury Department.

Musk, CEO of Tesla and SpaceX, also included his thoughts on Bessent in his post on X.

“My view fwiw is that Bessent is a business-as-usual choice,” he wrote.

“Business-as-usual is driving America bankrupt so we need change one way or another,” he added.

Musk also stated it would be “interesting to hear more people weigh in on this for @realDonaldTrump to consider feedback.”

Howard Lutnick, chairman and chief executive officer of Cantor Fitzgerald LP, left, and Elon Musk, chief executive officer of Tesla Inc., during a campaign event with former US President Donald Trump, not pictured, at Madison Square Garden in New York, US, on Sunday, Oct. 27, 2024.

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In a statement to Politico, Trump transition spokesperson Karoline Leavitt made it clear that the president-elect has not made any decisions regarding the position of Treasury secretary.

“President-elect Trump is making decisions on who will serve in his second administration,” Leavitt said in a statement. “Those decisions will be announced when they are made.”

Both Lutnick and Bessent have close ties to Trump. Lutnick and Trump have known each other for decades, and the CEO has even hosted a fundraiser for the president-elect.

The Wall Street Journal also reported that Lutnick has already been helping Trump review candidates for cabinet positions in his administration.

On the other hand, Bessent was a key economic advisor to the president-elect during his 2024 campaign. Bessent also received an endorsement from Republican Senator Lindsey Graham of South Carolina, according to Semafor.

“He’s from South Carolina, I know him well, he’s highly qualified,” Graham said.

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Protecting your portfolio against risks tied to Trump’s tariff plan

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2 days ago

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November 16, 2024

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Biggest Risks After the Rally: Trade & Top Valuations

Money manager John Davi is positioning for challenges tied to President-elect Donald Trump’s tariff agenda.

Davi said he worries the new administration’s policies could be “very inflationary,” so he thinks it is important to choose investments carefully.

“Small-cap industrials make more sense than large-cap industrials,” the Astoria Portfolio Advisors CEO told CNBC’s “ETF Edge” this week.

Davi, who is also the firm’s chief investment officer, expects the red sweep will help push a pro-growth, pro-domestic policy agenda forward that will benefit small caps.

It appears Wall Street agrees so far. Since the presidential election, the Russell 2000 index, which tracks small-cap stocks, is up around 4% as of Friday’s close.

Davi, whose firm has $1.9 billion in assets under management, also likes staying domestic despite the tariff risks.

“We’re overweight the U.S. I think that’s the right playbook in the next few years until the midterms,” added Davi. “We have two years of where he [Trump] can control a lot of the narrative.”

But Davi plans to stay away from fixed income due to challenges tied to the growing budget deficit.

“Be careful if you own bonds for sure,” said Davi.

Since the election, the benchmark 10-year Treasury yield is up 3% as of Friday’s close.

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