Crypto firms Phantom and Hyperliquid have petitioned the U.S. Commodity Futures Trading Commission (CFTC) to revise regulations, seeking exemptions from rules designed for traditional financial interm
Phantom, a crypto wallet provider, and Hyperliquid's Policy Center recently submitted a letter to the US Commodity Futures Trading Commission (CFTC), requesting updated regulatory guidelines. These companies are advocating for blockchain developers and non-custodial wallet providers to be exempted from regulations originally intended for traditional financial intermediaries.
The petition specifically asks that registration requirements apply only to entities handling customer funds or executing trades, not to software creators who develop onchain protocols without controlling their usage. Hyperliquid also requested guidance allowing regulated derivatives firms to utilize blockchain infrastructure while maintaining compliance with existing rules.
This move comes amid increasing tensions between crypto companies and traditional exchanges regarding the regulation of blockchain-based derivatives. In May, Intercontinental Exchange (ICE) and CME Group had urged regulators to scrutinize Hyperliquid's expansion into commodity-linked perpetual futures due to potential market integrity risks.
These calls for modernization are part of a broader debate over how onchain derivatives should be regulated in the U.S., with both crypto firms and traditional exchanges seeking clearer guidance. The CFTC has faced criticism from ICE, which sued the agency in June over its approval of crypto perpetual futures, arguing that it exceeded its authority under the Commodity Exchange Act.
The implications for traders are significant as these regulatory changes could open up new opportunities or impose additional compliance burdens. Traders should closely monitor how CFTC responds to this petition and any subsequent policy shifts that may affect onchain derivatives trading platforms like Hyperliquid and Phantom.
In summary, the submission from Phantom and Hyperliquid highlights a growing push for more flexible regulations in the crypto space, which could have far-reaching effects on both innovation and market participation.
Source: Cointelegraph. Summarized and rewritten by the Vexoda Newsroom. This is market news, not financial advice.