Hyperliquid Policy Center submits statement to CFTC calling for support for on-chain perpetual futures innovation

In comparison, the Hyperliquid Policy Center (HPC) announced that it has submitted a policy statement on the US Commodity Futures Trading Commission (CFTC) Agricultural Advisory Committee meeting to support the participation of US users in the on-chain derivatives market and call on regulators to adopt a gradual path to promote the development of innovative products such as perpetual futures (Perpetual Futures).

According to HPC, the US derivatives market originated in agriculture. In the 19th century, the Midwestern Food Exchange helped farmers and traders discover prices and manage future delivery risks through futures contracts. Since 1922, US futures market regulation has been part of the Department of Agriculture for a long time, until Congress established the CFTC in 1974, and responsibility for supervising the agency was handed over to the Senate and House Agriculture Committees. Modern derivatives regulation should still revolve around actual users of the market. Agricultural producers and processors have always been important clients of the CFTC, and market participants' needs for product selection, risk management tools, and market innovation should also be an important reference for the evolution of regulatory policies.

HPC points out that perpetual futures are now becoming an important innovative derivative in the digital asset era. The committee's discussions on product selection, risk management gaps, and market modernization are highly relevant to current regulators exploring the regulatory framework for on-chain derivatives. In the submitted statement, HPC made three main points:

1. Market selection is essential for risk management. Users in the agricultural and other derivatives markets need more tools to choose. Past experience limiting innovative products shows that closing market choices without adequate evaluation may result in costs.

2. It is a reasonable direction for the CFTC to promote the regulation of perpetual futures in stages. According to HPC, the development of new derivatives should be driven by end user needs rather than simply relying on regulatory assumptions.

3. Public blockchain can improve the efficiency of financial infrastructure. HPC believes that blockchain technology can drive the modernization of clearing and settlement systems, improve collateral liquidity, and continue to meet the requirements of the Commodity Exchange Act (Commodity Exchange Act) for market integrity and risk protection.

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