Hyperliquid's HYPE Token Climbs Over 15% to a Record High Above $35

Hyperliquid Labs' announcement that it had submitted two detailed comment letters to the U.S. Commodity Futures Trading Commission (CFTC)

Hyperliquid Labs, the developer behind the Hyperliquid decentralized exchange, has submitted two detailed comment letters to the U.S. Commodity Futures Trading Commission (CFTC). The letters, which build upon an earlier submission, highlight how DeFi can be utilized in the context of U.S. financial regulations.

As previously reported by Coin Edition, the CFTC is seeking public input on its plans for new regulations covering perpetual derivatives and continuous, round-the-clock crypto trading. In response, Hyperliquid Labs proposed using decentralized finance (DeFi) as a basis for future regulations. The team explained that DeFi methods can help financial services reach the same efficiency and user safety levels found in traditional financial markets. Hyperliquid’s submission arrives when U.S. regulators seek input on how to govern derivatives products that operate around the clock.

The CFTC has requested comments from the public on perpetual crypto trading. Hyperliquid Labs responded by presenting its protocol as a case study in how decentralized exchanges can meet, and even surpass, traditional benchmarks for security and transparency. The project runs on a high-performance blockchain and supports permissionless, 24/7 trading.

“We are honored to have had the opportunity to engage with the CFTC on matters of pressing importance to the future of digital assets and decentralized finance,” said the Hyperliquid team in a joint statement. “Our submissions highlight the unique capabilities of DeFi to align with the CFTC’s regulatory objectives, especially in the context of perpetual pricing and risk management.”

The Hyperliquid protocol has also drawn interest from major crypto investors and traders. On-chain open interest in Hyperliquid perpetuals surpassed $9 billion for the first time this week. Famous whales like “James Wynn” and large-scale traders have placed billion-dollar positions on the platform. As a result of their activity, the spotlight has intensified on both the protocol and its native HYPE token.

The protocol’s regulatory involvement occurs during a period of heightened trading activity. Hyperliquid relies on pre-funded collateral and does not use traditional banking systems. Its automated liquidation system allows margin requirements to be changed in real time to address a number of the CFTC’s risk management concerns. Focusing on these operational advantages, Hyperliquid Labs aims to prove that DeFi platforms can provide credible consumer protection.

“We believe that a principles-based approach to regulation is crucial for fostering innovation and adapting to the rapidly evolving digital asset landscape,” added the Hyperliquid team. “By focusing on risk profiles, consumer outcomes, and the potential of new technologies, regulators can create a regulatory framework that promotes stability, growth, and the public interest.”

In their submissions, the Hyperliquid Labs team recommended focusing on a flexible regulatory structure that could be adjusted over time. They also argued against assigning strict categories to different crypto projects, as this could hinder innovation. Instead, they suggested concentrating on the actual risk profiles of projects and the economic well-being of consumers.

The HYPE token’s rally has also received support from high-profile industry figures. Arthur Hayes, the former CEO of BitMEX, disclosed a significant purchase of HYPE tokens at $14.60 and later called the project “Beast Mode” on social media. Hayes has predicted that HYPE could reach $100.

Highlighting the technical aspects of the Hyperliquid protocol, Hayes described it as a showcase for DeFi’s advantages. Focusing on the protocol’s 24/7 trading and rapid liquidation system, Hayes stated that it outperforms the capabilities of traditional financial institutions.

The strong institutional and social backing arrives as HYPE hits a new all-time high of $37.34, with growing optimism around Hyperliquid’s regulatory approach. According to on–chain data, traders are placing both long and short bets, and recent liquidations underscore the volatility and volume of the platform.