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Jeff Yan pitches US oversight of the firms deploying markets on Hyperliquid

Hyperliquid CEO Jeff Yan wants US regulators to oversee the firms deploying markets on its chain, each of which must stake 500,000 HYPE. Under his model the chain itself sits outside exchange-level rules, and the licence and the liability belong to each operator.

The Investor · Invest desk

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Yan's pitch came after Payward's US deal Steps in Hyperliquid's US regulatory conversation in 2026, from Policy Center funding to Yan's Odd Lots appearance.

In 2026: February, Policy Center funded with 1 million HYPE; August 19, Trump says the CFTC chair is working to bring in Hyperliquid; September, Payward announces US perpetual futures tied to Hyperliquid; October 15, Yan sketches US oversight of firms running its markets.

  1. 2026Hyperliquid Policy Center funded with 1 million HYPE, claim 13
  2. 2026Trump says CFTC chair is working to bring in Hyperliquid, claim 7
  3. 2026Payward announces US perpetual futures tied to Hyperliquid, claim 5
  4. 2026Yan sketches US oversight of firms running its markets, claim 1
Yan's pitch came after Payward's US deal
DateEventClaim
February 2026Hyperliquid Policy Center funded with 1 million HYPE13
August 19, 2026Trump says CFTC chair is working to bring in Hyperliquid7
September 2026Payward announces US perpetual futures tied to Hyperliquid5
October 15, 2026Yan sketches US oversight of firms running its markets1

What happened

  • Yan argued from an internet analogy: nobody asks the protocols that carry web traffic to register as a bank, and the bank running a site on top handles compliance.
  • In September, Kraken's parent Payward announced a partnership with Bitnomial and NinjaTrader Clearing for permissioned perpetual futures tied to Hyperliquid markets, aimed at eligible US clients.
  • Crypto Briefing wrote that the CFTC has not formally adopted Yan's framework and that the SEC's view on where Hyperliquid fits is a separate variable.

Why it matters

  • What it limits constraint Hyperliquid cannot sign US customers itself under this model, so US volume grows only as fast as licensed operators choose to build on the chain.
  • Who's exposed exposure Payward and its partners, not Hyperliquid, are the entities the CFTC would reach, since they handle client onboarding, clearing and permissions.
  • What it costs cost HYPE holders see a direct link: each new market operator adds tokens committed to staking, so the US path is also a demand story for the token.

The stake is the one part of the pitch with a number on it. Anyone deploying a market through HIP-3 must lock up 500,000 HYPE for at least 183 days [11], and Yan's case is that this same party is the one a regulator should hold to account. "The regulation sits at the layer where there are controls, and indeed the deployers are the ones that exercise these controls," Yan said [2]. Crypto Briefing added that the CFTC already knows how to supervise clearing firms, futures commission merchants and exchanges [9].

In our view the pitch is coherent, with one soft spot: control is a test, and a regulator can apply it to more than one party. If the CFTC finds controls at the chain level too, the carve-out fails, and that would be the plainest evidence against this reading. Nothing the sources report says how Michael Selig's agency would rule.

Hyperliquid is funding the conversation and leaving the licence to others. The Hyperliquid Policy Center received 1 million HYPE in February to engage the CFTC and SEC [13]. That equals two deployer stakes (1,000,000 / 500,000) [16]. Yan spoke on Oct. 15 [1], 57 days after Trump said on Aug. 19 that Selig was actively working to bring Hyperliquid into US markets in a fully legal way [7][17]. Crypto Briefing noted that Hyperliquid had been preparing for the conversation well before Trump weighed in [15].

The sources describe Payward's product differently. Crypto Briefing calls the structure a working version of Yan's pitch, with Hyperliquid's markets supplying the underlying activity [18]. CoinDesk says Payward plans to offer derivatives using Hyperliquid's technology through a regulated exchange [6]. A market deployed on the chain would carry the 500,000 HYPE stake and would test the operator model directly; a regulated exchange that borrows the technology would not. The sources do not say which one Payward is building.

There is a milder way to be wrong. The CFTC could accept the split and US volume could still stay small, because every customer would arrive through a permissioned wrapper. We would not rule that out.

Yan framed the ask as additive. "We're not trying to displace anything," he said. "In fact, I think the technology can benefit everyone who currently operates markets in a more traditional setting." [3]

What to watch

  • Whether another US broker or clearing firm copies the Payward structure.
  • Any statement from the SEC on where Hyperliquid fits, since Crypto Briefing calls its view a separate variable.
  • How the Hyperliquid Policy Center spends its 1 million HYPE in talks with the CFTC and SEC.

Information, not investment advice. This story is general information about companies and markets, drawn from cited reporting. It is not a recommendation to buy, sell or hold any security; check the cited sources before acting.

Clarity's read

What the record supports and how the coverage leans. The claims behind it follow.

Reality

Evidence55
Adoption
Not scored
Hype gap+15
Incentives65
Confidence62
Why these scores

Claim ledger

Ranked by verification strength, evidence, and original report placement.

  1. [1]

    In an October 15, 2026 appearance on Bloomberg's Odd Lots podcast, Hyperliquid Labs CEO Jeff Yan sketched a model in which US oversight targets the financial firms that run markets on Hyperliquid's Layer-1 blockchain, with the blockchain itself outside exchange-level rules.

    Reported SupportedView cited source
  2. [2]

    "The regulation sits at the layer where there are controls, and indeed the deployers are the ones that exercise these controls," Yan said.

    Reported Supported Source: Jeff Yan, in a Bloomberg interview reported by CoinDeskView cited source
  3. [3]

    "We're not trying to displace anything," Yan said. "In fact, I think the technology can benefit everyone who currently operates markets in a more traditional setting."

    Reported Supported Source: Jeff Yan, in a Bloomberg interview reported by CoinDeskView cited source
  4. [4]

    Yan's core argument leaned on a comparison to the internet: nobody asks the protocols that move web traffic to register as a bank, and the bank running a website on top of those protocols handles the compliance.

    Reported SupportedView cited source
  5. [5]

    In September 2026, Payward, the parent company of Kraken, announced a partnership with Bitnomial and NinjaTrader Clearing to offer permissioned perpetual futures tied to Hyperliquid markets, aimed at eligible US clients who do not get direct access to the main Hyperliquid platform.

    Reported SupportedView cited source
  6. [6]

    Kraken's parent Payward plans to offer US investors derivatives using Hyperliquid's technology through a regulated exchange, even as Hyperliquid's perpetual futures market remains closed to them.

    Reported SupportedView cited source
  7. [7]

    On August 19, 2026, President Trump said CFTC Chair Michael Selig was actively working to bring Hyperliquid into US markets in a fully legal way.

    Reported SupportedView cited source
  8. [8]

    Yan's framework is a proposal, not policy: the CFTC has not formally adopted it, and the SEC's view on where Hyperliquid fits remains a separate variable.

    Reported SupportedView cited source
  9. [9]

    The CFTC already knows how to supervise clearing firms, futures commission merchants, and exchanges.

    Reported Supported Source: Crypto BriefingView cited source
  10. [10]

    In Payward's structure, regulated US firms handle client onboarding, clearing, and permissions, while Hyperliquid's markets provide the underlying activity.

    Reported SupportedView cited source
  11. [11]

    Under the HIP-3 framework, anyone who wants to deploy a market on Hyperliquid must stake 500,000 HYPE tokens for at least 183 days.

    Reported SupportedView cited source
  12. [12]

    The HIP-3 setup lets third parties stand up their own markets while the main Hyperliquid platform stays closed to US traders.

    Reported SupportedView cited source
  13. [13]

    In February 2026, the Hyperliquid Policy Center was funded with 1 million HYPE to engage with regulators including the CFTC and the SEC.

    Reported SupportedView cited source
  14. [14]

    Every HIP-3 deployer has to lock up 500,000 HYPE for at least 183 days, so a wave of new market operators would mean more tokens committed to staking.

    Reported SupportedView cited source
  15. [15]

    Hyperliquid had been preparing for the regulatory conversation well before Trump weighed in.

    Reported SupportedView cited source
  16. [16]

    The Policy Center's 1 million HYPE funding equals two HIP-3 deployer stakes of 500,000 HYPE each.

    Derived Supported
  17. [17]

    Yan's October 15 appearance came 57 days after Trump's August 19 remark.

    Derived Supported
  18. [18]

    Payward's structure is a working version of Yan's pitch, with Hyperliquid's markets providing the underlying activity.

    Reported Insufficient Source: Crypto BriefingView cited source

Sources

2 independent publishers whose own reporting we read for this story.

  1. coindesk.com

    1 article · October 15, 2026

    Hyperliquid founder wants U.S. oversight of trading platforms, not his blockchain
  2. cryptobriefing.com

    1 article · October 15, 2026

    Hyperliquid CEO Jeff Yan lays out a US compliance plan that regulates operators, not the chain

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