- Perpetual contracts would be classified by structure before regulators consider the referenced asset.
- Equity products with futures features could enter the jointly supervised security futures category.
- HIP-3 markets have recorded over $480 billion in volume and roughly $4 billion in open interest.
The Hyperliquid Policy Centre wants U.S. regulators to classify perpetual contracts by economic design, not merely their referenced assets. Its August 24 filing asks the SEC and CFTC to use one structural test. Equity-linked products with futures features could then qualify as security futures. The proposal responds to the agencies’ joint review of federal derivatives definitions.
Perpetual Contracts Need Structure-Based Classification
These products have no fixed expiry. Recurring funding payments instead pull market prices toward their benchmarks. HPC says standardized terms, fungibility, fixed unit sizes, and offsetting trades are established futures traits.
The agencies’ June request also examines exclusions from swap definitions for novel derivatives crossing jurisdictional lines. That question affects listing rights, registration duties, and venue competition.
The group argues that perpetual contracts sharing these mechanics deserve the same initial category. Bitcoin, oil, or stock references should not change that first decision. The referenced asset would determine jurisdiction only after regulators classify the structure.
Under this approach, a single-stock product treated as a future could enter the security futures category. That route gives the SEC and CFTC joint oversight. It also lets securities and futures exchanges list comparable products through notice registration.
Security Futures Could Divide SEC and CFTC Oversight
Hyperliquid’s HIP-3 markets strengthen the commercial case behind the request. The filing reports more than $480 billion in ten-month volume. It also cites roughly $4 billion in open interest across commodities, currencies, indexes, stocks, and ETFs.
Yet U.S. treatment of perpetual contracts remains contested. The CFTC approved a Bitcoin product as a future in May. CME later challenged that approach, arguing the product belongs within the swaps framework.
HPC says cash-settled equity perpetual contracts can qualify as security futures when their mechanics resemble exchange-traded futures. Holders receive price exposure, but no voting rights or ownership claims in the referenced shares.
The group asks regulators to preserve flexibility for bilateral products lacking fungibility, multilateral execution, or offset rights. Those instruments could remain swaps or security-based swaps. The SEC and CFTC could start with joint guidance before pursuing formal rulemaking.
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