It would likely have been a private purchase item. It was quite common in medieval times for people to show off their wealth with elaborately decorated but fully functional daggers. I would not be surprised to see the same in Roman times. It quite likely belonged to an officer from a wealthy family who wanted to show off his social status and would have been carried on the battlefield as it looks perfectly serviceable.
Fashion had a lot to do with it as well. As someone else mentioned, it has a resemblance to certain types of gladius as well as earlier leaf-shaped swords. They typically look like a scaled down gladius.
The emblem in the rectangular plaque looks a bit like the astrological symbol for the sign Pisces. There was also a popular cult of Luna (The Moon), which was apparently linked to agriculture and chariot racing (obviously)
I would guess that this was some sort of presentation or parade weapon. Functional blade, but certainly blinged up to the max with symbols important to the owner.