Appold Market Watch - Week ending 11 April 2025

Market Update & Industry News - Week ending 11 April 2025

🔷 Ripple announced a $1.25 billion acquisition of multi-asset prime broker Hidden Road, marking it as one of the largest deals in the digital asset industry. The acquisition expands Ripple’s institutional reach, boosts RLUSD stablecoin utility, and positions Ripple as the only digital asset firm to own and operate a global multi-asset prime broker.

Appold View: This acquisition surprised many, who expected a traditional institution to acquire Hidden Road and assist in bolstering its balance sheet for expansion. As the first significant blockchain protocol to enter the non-bank prime brokerage space, Ripple will be looking to scale its infrastructure and increase the adoption of its RLUSD stablecoin by using it as collateral across the prime brokerage products.

🔷 Global asset manager BlackRock has expanded its partnership with Anchorage Digital, the only U.S. federally chartered digital asset bank. The partnership introduces a dual-custodian structure for BlackRock’s iShares IBIT Bitcoin Exchange Traded Fund (ETF), with Anchorage joining existing custodian Coinbase in safeguarding IBIT's Bitcoin reserves amid rising institutional and retail demand.

Appold View: BlackRock’s implementation of a dual-custodian model is not only a positive for risk management but also signals a possible break in Coinbase’s long-held dominance over custody arrangements for Wall Street digital asset ETFs.

🔷 The U.S. Department of Justice (DoJ) has disbanded its National Cryptocurrency Enforcement Team (NCET) as part of a DoJ policy shift from broad regulatory enforcement to targeting specific criminal misuse of digital assets. Founded in 2022 by the Biden administration, NCET investigated and coordinated cases involving alleged fraud and illicit finance, including one against Binance founder Changpeng Zhao that led to a conviction for violating anti-money laundering laws last year.

Appold View: This will be welcomed by many in the industry as it allows proportionate and specific enforcement instead of a broad-brush approach to digital assets. However, removing NCET could risk leaving the retail market more vulnerable to scams and illicit actors.

🔷 U.S. President Trump signed a law overturning an Inland Revenue Service (IRS) rule that classified decentralised digital asset exchanges as brokers for tax reporting purposes. The move rolls back a highly criticised Biden-era policy that sought to extend tax reporting obligations to decentralised finance (DeFi) platforms in an effort to crack down on potential tax evasion.

Appold View: The industry had vehemently opposed the proposed rule, arguing it was unworkable, as DeFi platforms lack intermediaries and do not collect user data, making compliance technically impossible. This policy win tells of the growing influence of the digital asset sector in the corridors of power in the U.S. 

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