Hyperliquid expands HIP-3 with licensing market

Hyperliquid launches an upgrade to the HIP-3 testnet, allowing independent deployment teams to control access to the perpetual contract market through on-chain whitelists

Core Summary:

• HIP-3 deployers can choose whether to restrict access to their independent operating markets.
• The on-chain whitelist can be managed by the deployer or its designated sub-deployer.
• The existing HIP-3 market will remain unchanged because this licensed feature is optional.
• Separate negotiations involving Hyperliquid Labs, Payward and Bitnomial still await approval from the U.S. Commodity Futures Trading Commission (CFTC).

Hyperliquid co-founder Jeffrey Yan said in the TestNet proposal that deployers will be able to create licensed markets and manage participant lists without having to hand over access decisions to Hyperliquid's core development team. In future network upgrades, HIP-3 will support optional deployer configurations in licensed markets. For example, this would allow U.S. investors or institutional investors with strict compliance rules to access specific markets.

Hyperliquid HIP-3 adds optional on-chain whitelisting

Based on preliminary design, deployers can maintain an approved on-chain list of participants or appoint a sub-deployer to handle access rights. Market operators that do not require licensing mechanisms can continue to adopt the existing HIP-3 structure without changing the way their markets operate.

Hyperliquid has released its first version on the testnet, allowing developers to review design details before release in any production environment. Yan said the specifications are still in the preliminary stages and the team can adjust the system after receiving technical feedback.

HIP-3 has previously allowed external teams to deploy the perpetual contract market on HyperCore without seeking approval from Hyperliquid core developers. Each deployer selects the assets available in its market and controls multiple operating terms, including oracle inputs, leverage limits, and fees.

Responsibility remains with the deployment team. Independent operators manage their markets, oversee settlements, and resolve issues related to the products they list, while Hyperliquid provides the underlying blockchain and transaction infrastructure. Adding licensing capabilities extends the operating capabilities of existing tools rather than transferring market control to Hyperliquid. Teams can use whitelists when business models, legal obligations, or internal policies require restrictions on participation; another deployer can keep its market open under the current framework.

The design also separates infrastructure governance from market-level access. Hyperliquid will maintain the underlying network running, but each participating team will decide whether to activate the whitelist and who is eligible for its deployment.

Independent deployers retain operational responsibilities

HIP-3 is designed to support third-party launched markets, rather than limiting product creation to Hyperliquid's own team. Deployers can list perpetual contracts tied to crypto assets and other reference markets, provided they manage technical and operational responsibilities related to the product.

Perpetual contracts have no fixed expiration date. Regular funding payments help keep their prices close to the reference asset, allowing traders to maintain positions as long as they meet applicable margin requirements. Through HIP-3, independent teams can decide on the structure of these contracts. The choice of oracle affects the reference price used by the market, leverage rules determine how much exposure a trader can take, and fee settings determine the fees paid by participants for a trade.

Permitted deployments will add participant filtering to these control lists. Hyperliquid does not say that all HIP-3 operators must use this feature, and the release of testnet will not automatically change existing markets.

This separation is consistent with Hyperliquid's description of itself as a neutral infrastructure provider rather than an operator for every market built on its systems. Deployers are responsible for the products they introduce and the access rules for the applications they choose. Under this structure, the responsibility for oracle quality, leverage settings, billing procedures and Access Management lies with the operator, not Hyperliquid's central development group.

During the testnet phase, participating developers can evaluate how the whitelist interacts with trading accounts, market permissions, and sub-deployer roles. Hyperliquid has not announced a timetable for moving the feature to the main network, and feedback may change the final specification.

Licensed markets can support compliance controls

On-chain whitelists provide a technical way to limit participation, but the proposal does not indicate that whitelists are activated even if deployment complies with the regulations of any particular jurisdiction. Legal obligations depend on the assets, customers, operators and countries involved, while white lists only control which blockchain accounts can enter the market.

For operators facing U.S. markets, derivatives access is usually related to Commodity Futures Trading Commission (CFTC) rules and licenses held by venues, clearing organizations and intermediaries. Simply licensing software does not replace the registration, customer protection, reporting and market monitoring requirements imposed by regulators.

In July this year, the Hyperliquid Policy Center and Phantom requested that rules be tailored for a decentralized trading system. The two groups reportedly believed that software developers and unmanaged wallet providers should not automatically face the same registration obligations as traditional financial intermediaries, who control customer assets.

On August 26, the Hyperliquid Policy Center and Trade [XYZ] submitted an application for an energy sustainability contract linked to West Texas Intermediate Crude Oil (WTI), Brent Crude Oil and Port Henry Natural Gas. The application states that trade[XYZ]It has been operating the third-party perpetual contract market on Hyperliquid since October 2025 and has recorded cumulative transaction volume of more than US$500 billion across multiple asset classes.

Subject to the application, any regulated U.S. operator will still be required to comply with CFTC rules covering customer protection, market integrity and record-keeping. The groups also proposed leverage limits on specific assets, lay-language fund disclosures, and controls on benchmark reliability and manipulation risks.

The CFTC has not yet approved the requested energy product. The scope of its review includes price reliability, monitoring, position limits, margins, clearing, and the possible impact of continuous derivatives trading on the physical commodity market.

U.S. perpetual contract program requires regulatory approval

Separate discussions involving Hyperliquid Labs and Kraken parent company Payward may place selected crypto perpetual contracts on Bitnomial, a regulated U.S. derivatives exchange. According to reports provided, Payward has submitted the proposed structure to the CFTC but has not yet confirmed authorization.

According to the arrangement under discussion, eligible Bitnomial customers can use Hyperliquid technology to trade selected crypto-linked futures. Bitnomial will provide a regulated trading venue, while the proposed technical and operational roles will depend on the structure that the company and the CFTC ultimately accept.

Payward already owns Bitnomial, which holds U.S. exchange, clearing house and broker licenses. Kraken launched regulated perpetual contracts for eligible U.S. customers through Bitnomial in June, allowing users to manage spot, margin, traditional futures and perpetual contracts from Kraken Pro accounts.

The proposed Hyperliquid arrangement involves selected contracts that use its technology and is different from Kraken's existing Bitnomial products. Any launch will depend on the CFTC's evaluation of Payward's proposed contracts, market structures and safeguards.

Another legal dispute may also affect how such products reach U.S. customers. The Chicago Mercantile Exchange Group has challenged the CFTC's treatment of perpetual contracts, arguing that they should be governed by the Dodd-Frank Act as swaps rather than listed as ordinary futures.

The perpetual contract classification dispute began after the CFTC approved Kalshi's Bitcoin perpetual contract in May. The CME's stance will put these products under different regulatory frameworks, while the CFTC believes that federal law does not require futures contracts to have a fixed expiration date.

The Payward proposal involving Hyperliquid technology is still under review by the CFTC and has not yet confirmed a launch date, list of approved contracts or final qualification requirements for Bitnomial customers.