Hyperliquid urges SEC, CFTC to clarify perpetual contract rules

Hyperliquid Policy Center urges the SEC and CFTC to classify equity perpetual contracts as security futures, advocating for consistent standards and a modernized framework as HIP-3 markets surpass $480B in volume.

The Hyperliquid Policy Center (HPC) has submitted comment letters to the SEC and CFTC, urging both agencies to classify cash-settled equity perpetual contracts as security futures. HPC argues that, despite lacking an expiry date, perpetual contracts function similarly to traditional futures and should be regulated accordingly, regardless of whether the underlying asset is Bitcoin, crude oil, or a single stock. The group recommends that the structure of the derivative, rather than the underlying asset, should determine its classification. HPC also calls for consistent standards between the SEC and CFTC, and advocates for modernization of the security futures framework to accommodate new product structures. These changes, they suggest, could be implemented through interpretive guidance or policy statements. This push comes as Hyperliquid's HIP-3 markets have processed over $480 billion in notional volume within ten months, underscoring the growing importance of perpetual contracts. HPC believes that a harmonized regulatory approach would reduce uncertainty and allow exchanges to compete on execution quality and liquidity.