Nazia Saeed
- 21Shares launches the first ETP tracking dYdX, offering institutional exposure to DeFi derivatives.
- The new fund will be supported by dYdX’s Treasury subDAO and will introduce staking and auto-compounding features.
- As the demand for crypto derivatives grows, both Kraken and Cboe expand their derivatives offerings, highlighting the growing institutional interest in crypto futures and perpetual contracts.
21Shares, a leading Switzerland-based crypto exchange-traded products (ETP) issuer, has launched the first-ever fund tied to dYdX, a decentralized exchange (DEX) specializing in perpetual futures. This new product offers institutional investors a regulated entry point to gain exposure to the DeFi derivatives protocol.
dYdX has already surpassed $1.4 trillion in cumulative trading volume and currently lists over 230 perpetual markets. The dYdX Treasury subDAO is supporting the physically backed product through a DeFi treasury manager, kpk.
A milestone in DeFi adoption
By positioning dYdX within a regulated ETP, 21Shares is effectively creating an on-ramp for institutions to access DeFi through the ETP wrapper. This launch represents a milestone moment in DeFi adoption, allowing institutions to access dYdX through the ETP wrapper – utilizing the same infrastructure already in use for traditional financial assets.
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Following the launch, staking will also be introduced, allowing investors to lock up their DYDX tokens to help secure the network in exchange for rewards. 21Shares also plans to introduce an auto-compounding feature that will automatically reinvest the staking rewards into DYDX token buybacks.
dYdX’s expansion roadmap
The release also highlighted dYdX’s expansion plans, including a Telegram-based trading feature set for later this month and a spot market that will initially support Solana. Additionally, perpetual contracts tied to real-world assets, such as equities and indexes, will be launched, alongside a fee discount program for dYdX stakers and broader deposit options across stablecoins and fiat.
The 21Shares dYdX ETP will be launched on Euronext Paris and Euronext Amsterdam under the ticker symbol DYDX.
Growing demand for crypto derivatives
The launch of the dYdX ETP comes amid growing demand for crypto derivatives, with both traditional and centralized crypto exchanges expanding their offerings. In July, Kraken launched a CFTC-regulated derivatives arm after acquiring NinjaTrader, a futures broker, for $1.5 billion. This derivatives platform provides access to CME-listed crypto futures.
On October 10, Cboe, one of the world’s largest exchange operators, announced plans to launch continuous futures for Bitcoin and Ether. These contracts, which will be listed on the Cboe Futures Exchange, are designed to offer long-term exposure to crypto assets in a centrally cleared, regulated framework.
Meanwhile, Bitget, a Singapore-based cryptocurrency exchange, reported $750 billion in derivatives volume for August, bringing its cumulative total to $11.5 trillion since launch. The exchange also ranked among the top three global futures venues for Bitcoin and Ether open interest, with BTC futures surpassing $10 billion and ETH open interest trending above $6 billion.
Growth of the crypto derivatives market
The first regulated crypto derivatives were launched in December 2017 by Cboe and CME, introducing cash-settled Bitcoin futures. While Cboe exited the market in 2019 due to low volumes, CME’s contracts have grown to dominate US crypto derivatives trading.
According to CoinMarketCap, the current open interest in crypto derivatives stands at $3.96 billion in futures and $984 billion in perpetual contracts.
