dYdX acquires crypto social trading platform Pocket Protector in first external acquisition

Decentralized derivatives exchange dYdX has acquired Pocket Protector, a crypto social trading platform, marking its first external acquisition.

The deal brings the bulk of Pocket Protector’s engineering team into dYdX, as well as co-founders Eddie Zhang and Kaiser Kinbote, who will join dYdX as president and head of growth, respectively. Pocket Protector had a total headcount of nine, dYdX founder and CEO Antonio Juliano told The Block.

Talks between the two firms began in March and the deal closed just over a month later, Juliano said. He declined to disclose the deal size but said it was financed through a mix of cash and dYdX tokens. The dYdX token is currently trading at $0.67, with a market cap of around $507 million and a fully diluted valuation of about $645 million, according to The Block’s dYdX price page.

Founded last year, Pocket Protector raised $7 million from investors including Electric Capital and Dragonfly, Juliano said. Its Telegram-based trading bot enables users to trade alongside friends, follow top traders, and discover real-time trade ideas. It also developed an iOS app currently in private closed beta — but that app won’t be launched to the public in light of the acquisition, Juliano said.

dYdX acquired Pocket Protector to expand into new forms of trading and integrate social features into its core products, though Juliano declined to share specific product plans. He emphasized the strategic value of bringing Zhang and Kinbote into leadership roles. Zhang previously led product at Messenger at Meta, co-founded the social app Fam, and worked on consumer growth at Eventbrite. Kinbote brings a decade of crypto-native experience in product-led growth, tokenomics, and community building, dYdX said.

The acquisition follows internal restructuring at dYdX. Last month, the company brought marketing, business development, and solutions teams from the dYdX Foundation in-house, forming a new international subsidiary under dYdX Trading Inc.

It also comes months after dYdX laid off 35% of its team in October. Juliano said the layoffs weren’t financially driven but rather a move to reset the company’s structure and return to a lean, startup-focused approach. “It has been important to me we keep the team lean and intentional in order to adapt to the fast changing landscape,” he said. “Since then, we have been strategically adding key roles and new leadership in order to scale our product for the future.”

Since launching in 2017, dYdX has facilitated over $1 trillion in cumulative trading volume. Pocket Protector, launched last year, grew to 50,000 users and at its peak reached more than $1 billion in annualized trading volume, dYdX said.

dYdX’s acquisition of Pocket Protector comes amid a surge in crypto M&A activity this year. Notable deals include Coinbase’s $2.9 billion acquisition of Deribit, Kraken’s $1.5 billion purchase of NinjaTrader, Ripple’s $1.25 billion takeover of Hidden Road, Stripe’s $1.1 billion deal for Bridge, and Robinhood’s $200 million acquisition of Bitstamp.

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