Ripple is entering the swap-financing market for leveraged ETFs, challenging traditional Wall Street banks, The Wall Street Journal reported. NS3.AI says Ripple joined the space last year after acquiring prime broker Hidden Road for about $1.25 billion.

Morningstar Direct counts 593 leveraged ETFs in the United States, with assets totaling more than $256 billion. Nonbank firms are gaining ground as banks tighten risk controls and as newer issuers lack established banking relationships.

Dan Aronson of Janus Henderson warned that a single-day stock move of 50% or more could wipe out a fund and leave Ripple exposed to losses.

In related market action, XRP slid about 6% on Thursday.