Why are Phantom and the Hyperliquid Policy Center asking the CFTC to change its rules?

Phantom and the Hyperliquid Policy Center asked the Commodity Futures Trading Commission (CFTC) to update rules for onchain derivatives. The groups said blockchain developers and non-custodial wallet providers should not be regulated like traditional financial intermediaries.

What changes do Phantom and the Hyperliquid Policy Center want from the CFTC?

Phantom and the Hyperliquid Policy Center asked the Commodity Futures Trading Commission (CFTC) to confirm that blockchain developers do not need to register simply for creating onchain software. They also requested exemptions for non-custodial wallet providers and guidance allowing regulated firms to use blockchain infrastructure.

What are non-custodial wallets according to Phantom?

Phantom said non-custodial wallets allow users to control their own digital assets without the wallet provider holding customer funds. The company argued these services should not be treated as introducing brokers under Commodity Futures Trading Commission (CFTC) rules.

What does the proposal mean for onchain derivatives markets?

Phantom and the Hyperliquid Policy Center said the proposed Commodity Futures Trading Commission (CFTC) changes would allow regulated firms to use blockchain technology for trade execution, clearing, settlement, margining and recordkeeping while remaining compliant with existing regulations.

Why is the Commodity Futures Trading Commission (CFTC) reviewing onchain derivatives now?

The Commodity Futures Trading Commission (CFTC) is reviewing feedback as crypto companies and traditional exchanges seek clearer rules for blockchain-based derivatives. The debate has intensified as firms such as CME Group and Intercontinental Exchange expand their digital asset strategies while challenging parts of the current regulatory framework.

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Phantom and Hyperliquid seek CFTC rule changes

Written by Isaac FrancisPublished Jul 10, 2026, 12:45 AM

Phantom and the Hyperliquid Policy Center asked the CFTC to modernise rules for onchain derivatives.
The groups said blockchain developers and non-custodial wallet providers should not face rules meant for traditional intermediaries.
The proposals aim to support wider use of blockchain infrastructure in regulated derivatives markets.

Phantom and the Hyperliquid Policy Center urged the Commodity Futures Trading Commission to update its rules for onchain derivatives and exempt blockchain developers and non-custodial wallet providers from certain registration requirements.

The groups said current regulations were designed for firms that hold customer assets or execute trades, not developers who build blockchain software or open-source protocols.

The organisations also asked the CFTC to confirm that regulated derivatives exchanges, clearinghouses and intermediaries can use blockchain technology for trade execution, clearing, settlement, margining and recordkeeping while remaining compliant with existing rules.

The groups said adopting the proposals would improve access to onchain derivatives markets, while keeping the current framework could leave more innovation outside the United States.

The request follows growing debate over onchain derivatives, with Intercontinental Exchange and CME Group previously calling for closer oversight of Hyperliquid's commodity-linked perpetual futures.

CME has expanded its regulated crypto derivatives business this year but also sued the CFTC in June, arguing the agency exceeded its authority when approving crypto perpetual futures.