21Shares launches dYdX ETP amid a wave of institutional interest in crypto derivatives

21Shares, based in Switzerland, one of the largest cryptocurrency exchange-traded product issuers (ETP) in Europe, has officially launched its first fund linked to dYdX — the decentralized exchange (DEX) specializing in perpetual derivative contracts.

dYdX has processed a total trading volume exceeding $1.4 trillion, listing over 230 perpetual contract markets. This new ETP product is backed by the dYdX Treasury subDAO fund, managed by kpk — a treasury management unit in the decentralized finance space (DeFi).

21Shares announced that bringing dYdX into the ETP framework will pave the way for financial institutions to access it more easily.

"This is an important milestone in the adoption of DeFi, as institutions can invest in dYdX through ETP — leveraging the infrastructure they are already familiar with in the traditional financial asset market," emphasized Mandy Chiu, Director of Financial Product Development at 21Shares.

According to the disclosure, the staking feature ( locks tokens to receive rewards ) will be added immediately after the launch, along with a mechanism for automatic reinvestment of profits into buying back DYDX tokens.

The expansion plan of dYdX was also announced, including: trading via Telegram at the end of this month, launching the spot market starting with Solana, implementing perpetual contracts linked to real assets (stocks, index), a fee reduction program for DYDX stakers, and supporting a wider variety of deposits (stablecoin and fiat).

The 21Shares dYdX ETP will be listed on the Euronext Paris and Euronext Amsterdam exchanges with the trading code DYDX.

Kraken, Cboe and Bitget strengthen the cryptocurrency derive sector

The move by 21Shares comes amid a backdrop where both traditional exchanges and centralized cryptocurrency exchanges are accelerating the expansion of derivative products — a type of contract that allows investors to speculate on price fluctuations without having to hold the underlying asset.

In the US, Kraken launched a CFTC-licensed derivatives branch in July, following the acquisition of futures broker NinjaTrader for $1.5 billion. This platform provides access to cryptocurrency futures listed on the CME.

On November 10, Cboe — one of the largest exchanges in the world — is expected to launch "continuous futures" products for Bitcoin and Ether, pending approval from the regulatory authorities. These will be 10-year futures contracts, designed based on the perpetual contract model that is popular in foreign markets, but appearing for the first time in the U.S. legal environment.

Meanwhile, Bitget, a cryptocurrency exchange based in Singapore, recorded a total derivative volume of $750 billion for August, bringing the total accumulated volume since its inception to $11.5 trillion. The exchange ranks in the top 3 globally for open contracts in Bitcoin and Ether, with BTC contracts exceeding $10 billion and ETH over $6 billion.

The first cryptocurrency derivative products were legally listed in December 2017, when Cboe and CME launched cash-settled Bitcoin futures contracts. After Cboe withdrew in 2019 due to low liquidity, CME rose to lead the crypto derivatives market in the U.S.

According to CoinMarketCap, the total open interest (open interest) is currently approximately 3.96 billion USD for futures contracts and 984 billion USD for perpetual contracts.

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