3 weeks ago
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Two players in the on-chain derivatives world want the CFTC to stop treating perpetual contracts like they’re exotic creatures and start treating them like what they are: swaps with a slightly different engine under the hood. The Hyperliquid Policy Center (HPC) and trade[XYZ] submitted a joint comment letter on August 24, 2026, asking regulators to create a unified framework that would greenlight energy perpetual contracts, stablecoin integration, and on-chain infrastructure in the US market.
The argument is straightforward. If the CFTC already approved the first US-listed perpetual contract back in May, why should the regulatory treatment change depending on whether the underlying asset is Bitcoin or a barrel of West Texas Intermediate crude?
The case for economic structure over asset-specific rules
The comment letter, addressed to both the SEC and CFTC, makes one central pitch: regulate perpetual contracts based on their economic structure, not on the specific asset they reference. A perp is a perp, whether it tracks BTC or Brent crude. The funding rate mechanism, the margin requirements, the settlement logic. These are structural features that don’t fundamentally change when you swap out the underlying.
Trade[XYZ] already offers 24/7 perpetual contracts on WTI and Brent crude with leverage up to 20x on Hyperliquid’s HIP-3 markets. The contracts maintain median pricing deviations under 5 basis points from reference benchmarks.
The numbers backing the pitch are substantial. In just ten months of operating HIP-3 markets, trade[XYZ] has reported over $480 billion in cumulative notional volume and roughly $4 billion in open interest. Hyperliquid’s broader ecosystem has processed more than $3 trillion in total market activity during 2025, with an additional $1.5 trillion recorded through mid-2026.
Why this matters now
The timing of this letter isn’t accidental. The CFTC approved BTCPERP, the first US-listed perpetual contract, on May 29, 2026. That decision cracked open a regulatory door that had been bolted shut for years. Perpetual contracts, which have been the bread and butter of offshore crypto exchanges since BitMEX popularized them, were essentially persona non grata in the US market until that approval.
But BTCPERP was a narrow win. It covered crypto-native assets on a regulated venue. What HPC and trade[XYZ] want is for the CFTC to take the logical next step: extend that same treatment to traditional commodities like crude oil when they’re offered as perpetual contracts on on-chain infrastructure.
Traditional exchanges, including CME Group and others that dominate energy futures, have already expressed concerns about market integrity and competition from these newer venues.
HPC, which was established in February 2026 with funding of 1 million HYPE tokens (worth approximately $29 million at the time), has been building toward this moment. The policy center’s prior comment to regulators focused on differentiating on-chain protocols from traditional intermediaries, arguing that smart contracts can perform clearing and settlement functions that regulators currently require licensed entities to handle.
The regulatory chess match
The joint letter arrives during a period of active rulemaking around digital asset derivatives. The SEC and CFTC have been working through overlapping jurisdictional questions about which agency oversees what, particularly when it comes to products that blur the line between securities and commodities.
HPC’s position is that this ambiguity is exactly the problem. By creating asset-specific regulatory buckets, where crypto perps get treated one way and energy perps get treated another, regulators risk building a framework that’s already outdated by the time it’s finalized. A structure-based approach would create a single set of rules for any perpetual contract, regardless of what it tracks.
Traditional exchanges argue that 24/7 trading in leveraged energy products could amplify volatility during low-liquidity periods, particularly overnight or on weekends when physical commodity markets are closed. The sub-5 basis point pricing deviation that trade[XYZ] touts is impressive under normal conditions, but the question regulators will ask is how those spreads behave during genuine market stress.
Disclosure: This article was edited by Editorial Team. For more information on how we create and review content, see our Editorial Policy.
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