21Shares rolls out DYDX ETP as DeFi derivatives edge toward mainstream

21Shares is positioning institutional investors at the convergence of TradFi and on-chain finance. The new DYDX product launches as the underlying protocol expands into real-world assets, targeting a slice of the vast derivatives market.

According to a press release shared with crypto.news on September 11, European ETP issuer 21Shares has listed a new physically-backed product tracking the DYDX token. This provides a regulated avenue for institutional portfolios to gain exposure to the native asset of the dYdX Chain, a decentralized derivatives protocol that has settled over $1.4 trillion in volume.

The launch, supported by the dYdX ecosystem’s Treasury subDAO, marks a significant infrastructural play, packaging a DeFi governance token into a wrapper familiar to traditional finance.

Bridging the gap between TradFi and DeFi’s engine

Marcelo Ruiz de Olano, CEO and co-founder of kpk, framed the development as a critical simplification of DeFi’s complexity for traditional capital. He noted that promising DeFi tokens often “fly under the radar” for institutional investors lacking the technical bandwidth for on-chain operations.

The ETP, he stated, changes this by making dYdX accessible through a simple ticker and trade mechanism, integrating it into the existing infrastructure used for any listed security. Additionally, Ruiz de Olano highlighted kpk’s role through the Treasury subDAO in aligning real protocol revenues with tokenholder value, positioning the ETP as an entry point into the protocol’s economic activity without the operational hurdles.

In the statement, the launch is contextualized by a staggering market disparity. While global derivatives markets command over $100 trillion in notional value after growing 2% year on year at end-June 2024, DeFi’s share remains miniscule, capturing less than one percent of this vast scale.

This yawning gap represents both the nascent stage of on-chain derivatives and their monumental growth potential. The 21Shares DYDX ETP arrives as a pivotal instrument, providing a regulated and familiar vehicle for institutions to gain exposure to this potential expansion.

dYdX’s traction

Notably, the product’s introduction is synchronized with dYdX’s own high-velocity expansion plans. 21Shares indicated the launch is aligned with the protocol’s move into new, transformative verticals, according to its updated roadmap.

This includes the imminent rollout of Telegram trading, which promises seamless cross-platform execution, and the upcoming integration of spot trading, beginning with Solana. Most significantly, the protocol is venturing into perpetual contracts for real-world assets, such as equities and pre-IPO shares, directly on-chain. This expansion fundamentally broadens DYDX’s utility beyond crypto natives, targeting the very heart of traditional finance.