TL;DR
- dYdX acquired Pocket Protector to add social trading features, bringing in its co-founders Eddie Zhang and Kaiser Kinbote as president and head of growth.
- Pocket Protector has a team of nine engineers and a user base of 50,000.
- This acquisition comes after an internal restructuring at the exchange.
dYdX bought Pocket Protector, marking its first external acquisition, to add social trading features and expand its product offering. Co-founders Eddie Zhang and Kaiser Kinbote will join the exchange as president and head of growth, bringing their expertise in product development and tokenomics.
Negotiations began in March and closed just over a month later. The deal combined cash and dYdX tokens, which currently trade around $0.67 with a market cap near $507 million. Founded last year, Pocket Protector raised $7 million from investors including Electric Capital and Dragonfly.
Pocket Protector developed a Telegram bot that allows users to follow top traders and share real-time trade ideas. It was also working on an iOS app, which will not be released following the acquisition. The team of nine engineers joined to the exchange to support the development of collaborative tools.
dYdX Reduced Its Staff by 35%
The acquisition follows an internal restructuring that included bringing marketing and business teams from the dYdX Foundation in-house. In October, the company cut 35% of its staff to focus on operating with greater agility. According to CEO Antonio Juliano, these changes aimed to align the structure with market demands.
Since 2017, the exchange has facilitated over $1 trillion in cumulative trading volume. Pocket Protector grew to around 50,000 users and achieved over $1 billion in annualized trading volume. With this purchase, the exchange intends to integrate social trading directly into its decentralized derivatives ecosystem.
The acquisition adds to a long list of mergers and acquisitions in the sector. This year, Coinbase bought Deribit for $2.9 billion, Kraken acquired NinjaTrader for $1.5 billion, and Ripple took control of Hidden Road for $1.25 billion, among other major deals. dYdX aims to strengthen its position and attract new users through this acquisition
