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Ripple, a crypto blockchain firm, has recently completed the acquisition of Metaco, a Swiss digital asset custody company. The deal, valued at $250 million, establishes Ripple as the sole shareholder of Metaco, which will maintain its operations as an independent brand.
Metaco specializes in providing tokenization tools and custody infrastructure to enable institutions to scale their business models within the crypto economy. Noteworthy clients of Metaco include Citi, Union Bank, and Bank BNP Paribas.
Ripple Acquires Metaco in a $250 Million Deal
Ripple has acquired Metaco to offer a wider range of services to institutions. This means that customers, both institutional and regular, will have access to the technology needed for storing, issuing, and completing transactions involving different types of tokenized assets.
Metaco anticipates accelerated growth as a result of joining forces with Ripple, leveraging the latter’s established customer base and available resources. This partnership aligns with Ripple’s long-term strategy of making strategic investments in the market, even during periods of cryptocurrency market volatility.
Sagar Shah, Ripple’s head of custody, emphasized the growing significance of crypto assets under custody, which are projected to exceed $10 trillion by 2030. Shah stated that institutional adoption will play a crucial role in driving this trend.
By offering comprehensive custody, issuance, and settlement services for tokenized assets, Ripple aims to capture this emerging market while diversifying its revenue streams and aligning with industry growth.
Shah’s sentiments on tokenization were echoed by industry leaders. The CEO of Blackrock, a prominent investment powerhouse, highlighted the potential of tokenization in shaping the next generation of markets.
Similarly, Ronit Ghose, Citi Bank’s future of finance lead, lauded tokenization as blockchain’s “killer use case,” projecting substantial growth of up to 80 times in private markets, with a total value reaching nearly $4 trillion by 2030.
Today, we are proud to announce Ripple has acquired @metaco_sa, becoming the sole shareholder of the Swiss-based provider of digital asset custody and tokenization technology.
Learn more: https://t.co/GrI3u13iDT
— Ripple (@Ripple) May 17, 2023
Ripple’s acquisition of Metaco reflects its strategic approach of capitalizing on the immense potential of tokenization and expanding its foothold in the institutional market. By embracing tokenization as a transformative force, Ripple seeks to position itself at the forefront of the evolving digital asset landscape, offering innovative solutions and driving the widespread adoption of blockchain technology.
As the industry continues to evolve, the adoption of tokenization is poised to revolutionize various sectors, enabling increased liquidity, enhanced transparency, and streamlined processes. Ripple’s strategic move with Metaco signifies its commitment to staying at the forefront of this transformative shift and shaping the future of finance through blockchain-powered solutions.
Tokenization, as the industry progresses, holds the potential to revolutionize multiple sectors by facilitating greater liquidity, improved transparency, and streamlined operations. Ripple’s partnership with Metaco exemplifies its dedication to leading this transformative change and shaping the future of finance with innovative blockchain solutions.
Ripple’s Acquisition of Metaco Initiates Custody Industry’s Merger Wave, Driven by Market Dynamics
Ripple’s recent acquisition of custodian company Metaco marks the commencement of a wave of mergers and acquisitions within the custody industry, as stated by crypto advisory firm Architect Partners. This surge in activity is propelled by a multitude of market dynamics.
Architect Partners analyzed the Ripple-Metaco deal, highlighting Ripple’s goals to transform the cross-border payment market, explore opportunities in Central Bank Digital Currencies (CBDCs), and enable the issuance and settlement of tokenized assets.
The addition of Metaco’s custody technology and services not only helps Ripple safeguard customer assets but also gives Ripple control over the technology’s evolution and opens up a new revenue stream.
The advisory firm predicts that more strategic deals will take place in the custody market, citing regulatory requirements and the impact of the bear market. U.S. regulators have indicated that only registered Qualified Custodians (QCs) can handle digital and crypto assets, but currently, there are limited QCs available.
Regulators have also emphasized the operational separation of asset custody from execution activities, a model commonly seen in traditional finance but less prevalent in the crypto industry.
Traditional finance custodians, like Northern Trust and BNY Mellon, have been cautious about entering the crypto market due to regulatory and market risks. However, Architect Partners anticipate a shift in their stance in the future, presenting both a threat and an opportunity for specialized digital and crypto asset custody businesses.
The challenging market conditions during the crypto winter have also affected custodians, leading to slower growth in assets under custody and flat or declining revenues.
Nonetheless, Architect Partners believes that the industry will bounce back, urging custodians to maintain financial stability and confidence in the anticipated upturn.
Ripple’s acquisition of Metaco is seen as a precursor to further consolidation in the custody industry. Regulatory requirements, market conditions, and the need for specialized custodial services are driving forces behind this trend, with traditional finance players expected to enter the crypto custody space in the future.
About Metaco
Metaco is a leading technology company specializing in digital asset management and blockchain solutions. With a focus on providing secure, scalable, and compliant infrastructure, Metaco empowers financial institutions and businesses to navigate the complex world of leading cryptocurrencies and decentralized finance.
Their cutting-edge technology encompasses secure key management, multi-signature wallets, and institutional-grade custody solutions. Metaco’s innovative approach enables seamless integration of digital assets into traditional financial systems, promoting efficient and secure transactions.
Through their expertise and robust infrastructure, Metaco plays a vital role in facilitating the widespread adoption of cryptocurrencies, heralding a new era of decentralized finance and digital asset management.
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