21Shares Launches Innovative DYDX ETP for Institutional Investors
By: Eliza Bennet
Europe’s prominent issuer of crypto exchange-traded products, 21Shares, has made a significant development by launching a fund that introduces dYdX into its product range. This innovative move marks the company's initiative to bridge traditional financial institutions with the decentralized finance (DeFi) derivatives offered by dYdX, a decentralized exchange (DEX) renowned for its perpetual futures.
The newly launched exchange-traded product (ETP) is notable for providing institutional investors much-needed access to DeFi derivatives markets without having to engage in the complexities that often accompany direct involvement in the crypto space. By facilitating exposure to dYdX, 21Shares aims to meet the growing demand for diversified crypto investment options within regulatory frameworks, opening a viable channel for potential large-scale investments.
The strategy is substantial, especially considering the performance of dYdX which boasts a cumulative trading volume exceeding $1.4 trillion across over 230 perpetual markets. The dYdX Treasury subDAO has been strategically involved, employing a decentralized finance treasury manager, kpk, to support the physically backed product. This enables a structured back-end integration, positioning the product well within regulated environments. It aligns with institutional investor needs for transparency and accessibility.
Furthermore, the addition of dYdX to 21Shares’ product suite, which already includes DeFi giants like Aave and Uniswap, highlights the trend of repackaging decentralized protocols for use by traditional investors. Such moves are shaped to cater to increasing institutional interest in crypto derivatives, prompting a blend of emerging decentralized technologies with structured, regulatory-approved financial products. This evolution reflects a paradigm shift in how crypto markets are opening up to mainstream finance, potentially altering the nature of crypto engagement on institutional levels.
