Hyperliquid, Phantom Fight 'Broker' Label
Hyperliquid and Phantom jointly submitted a petition to the CFTC asking the regulator to stop treating decentralized finance protocols as brokers and to modernize its rules for on-chain derivatives. The lobbying effort represents a direct attempt by two major DeFi platforms to shape the regulatory framework governing on-chain perpetual trading.
Onchain market devs: we're coders not broker!
Hyperliquid and Phantom argument is that a developer who writes software that lets two people trade directly with each other is not the same as a broker who holds your money and executes your order. Treating them identically doesn't regulate DeFi — it just bans it.
Phantom's no-action letter from March, already gave the wallet a limited pass to offer derivatives access without registering as a broker. The petition is asking the CFTC to turn that one-off relief into a real rule covering the whole sector.
That matters for Hyperliquid.
If the CFTC draws the line correctly - registration for entities that control funds, not for code - the platform's expansion into US markets becomes a legal path rather than a regulatory minefield.
2 sources
- Phantom, Hyperliquid ask CFTC to modernize rules for onchain derivatives · cointelegraph.com · T1
- Hyperliquid and Phantom ask the CFTC to stop treating DEFI like a broker · bsc.news · T2