Institutional Investors Get Regulated Access to DeFi With 21Shares’ DYDX ETP Launch

21Shares AG, a leading provider of crypto-backed exchange-traded products (ETPs), has launched a new ETP that tracks the price of dYdX (DYDX), a decentralized exchange platform operating on the Ethereum blockchain. The new ETP is available on several European exchanges and is intended to provide institutional and retail investors with a regulated and liquid exposure to DYDX without the need for direct cryptocurrency custody. The ETP is structured as a physically backed product, meaning it holds the underlying DYDX tokens in custodial accounts, offering investors greater transparency and security.

The launch of the DYDX ETP comes amid a growing interest in decentralized finance (DeFi) tokens among institutional investors. DYDX, which recently completed its token migration to Ethereum's Layer 2 network to improve scalability and reduce transaction costs, has seen increased adoption and trading volume on its platform. The ETP's listing is expected to further broaden access to DYDX for investors who are either restricted from holding digital assets directly or prefer to use traditional financial instruments to gain exposure.

21Shares' ETPs have previously been launched on tokens such as Bitcoin (BTC), Ethereum (ETH), and Solana (SOL), and this latest product continues the company's strategy of expanding its range of crypto-ETPs to cover high-demand tokens across different blockchain ecosystems. The DYDX ETP joins a growing list of ETPs available in markets such as Germany, Switzerland, and the United Kingdom, where regulatory clarity and investor protection are key selling points for these products.

According to a recent report from Morningstar, the total assets under management in ETPs tracking digital assets have increased by over 60% in the past year, driven by greater regulatory clarity and rising institutional demand. This trend has been particularly evident in Europe, where ETPs are seen as a more accessible and secure alternative to direct crypto purchases. The DYDX ETP is expected to benefit from this momentum, especially as DeFi continues to attract both retail and institutional attention.

The ETP is available with a management fee of 0.75% annually and is listed under the ticker symbol 234D in Switzerland and 234D.DE in Germany. Investors can trade the ETP during regular market hours on the exchanges where it is listed. The product's transparency is ensured through regular reporting of underlying token holdings and daily indicative net asset value (iNAV) updates.