21Shares Launches First dYdX Fund
Switzerland-based 21Shares, one of the largest issuers of crypto exchange-traded products in Europe, has introduced the first fund linked to dYdX, a decentralized exchange (DEX) focused on perpetual futures.
As per an announcement shared, dYdX has achieved a remarkable cumulative trading volume of over $1.4 trillion and features more than 230 perpetual markets. The dYdX Treasury subDAO facilitates the physically backed product through a decentralized finance (DeFi) treasury manager named kpk.
By incorporating dYdX into a regulated exchange-traded product (ETP), 21Shares stated it is creating a path for institutional investors.
“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,” said Mandy Chiu, head of financial product development at 21Shares, in the announcement.
According to a spokesperson from 21Shares, staking, which involves locking up tokens to secure a blockchain network in exchange for rewards, will be implemented shortly after the launch. “We will introduce DYDX staking and an auto-compounding feature — generating rewards that auto-compound into DYDX token buybacks,” the spokesperson stated.
The announcement also detailed dYdX’s expansion plans, which include trading through Telegram later this month, a new spot market that will initially feature Solana, perpetual contracts linked to real-world assets like equities and indexes, as well as a fee discount program for dYdX stakers and additional deposit options including stablecoins and fiat.
The 21Shares dYdX ETP is set to debut on Euronext Paris and Euronext Amsterdam, with the ticker symbol DYDX.
Growing Crypto Derivatives Market
The launch of the dYdX ETP occurs concurrently with the expansion of crypto derivatives offerings from various traditional and centralized crypto exchanges — financial contracts that enable traders to speculate on the pricing of digital assets without directly owning them.
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In the United States, Kraken established its CFTC-regulated derivatives arm in July after acquiring futures broker NinjaTrader for $1.5 billion. This derivatives platform offers access to CME-listed crypto futures.
On Tuesday, Cboe, one of the leading exchange operators globally, announced plans to introduce “continuous futures” for Bitcoin and Ether on November 10, pending regulatory approval. These contracts will be listed on the Cboe Futures Exchange and designed as single long-dated products with 10-year expirations.
Cboe stated that these contracts are modeled after perpetual-style futures that are prevalent in offshore markets but have previously been unavailable in a US-regulated environment. The exchange characterized them as providing institutional and retail traders with long-term crypto exposure within a centrally cleared, intermediated framework.
In the meantime, Singapore-based cryptocurrency exchange Bitget reported $750 billion in derivatives volume for August, bringing its total to $11.5 trillion since its inception.
This exchange ranked among the top three global futures venues for Bitcoin and Ether open interest during August, with Bitcoin futures exceeding $10 billion and Ether open interest trending above $6 billion.
The first regulated crypto derivatives were introduced in December 2017 when Cboe and CME launched cash-settled Bitcoin futures. Although Cboe exited the market in 2019 due to low volume, CME’s contracts have since grown to dominate US crypto derivatives trading.
Currently, open interest in crypto derivatives, representing the total value of active futures and perpetual contracts held by traders, is approximately $3.96 billion in futures and $984 billion in perpetuals, according to data from CoinMarketCap.
