Headline: FCA flags Hyperliquid as the debate over regulated crypto perpetuals heats up
The UK Financial Conduct Authority (FCA) has put Hyperliquid in the regulatory spotlight, issuing a warning that could reshape how perpetual futures trading is treated across markets. In a notice published May 21, the FCA said Hyperliquid, the Hyper Foundation, the protocol’s app and related social channels may be offering or promoting financial services or products in the U.K. without authorization. The regulator urged consumers to avoid dealing with the platform and reminded investors that unauthorized firms do not provide the protections available through regulated financial services.
That warning arrives as perpetual futures — or “perps” — become a major focal point for exchanges, trading firms and regulators. Perps differ from traditional futures because they have no expiry; prices are kept tethered to spot markets through recurring funding payments. Their flexibility and high leverage have attracted traders but also alarmed some market incumbents and watchdogs.
At Piper Sandler’s Global Exchange & Fintech conference on June 4, CME Group CEO Terry Duffy criticized the Commodity Futures Trading Commission’s recent move to permit regulated crypto perpetuals in the U.S. Duffy warned that perps, which can allow traders to hold leveraged positions indefinitely (he cited leverage as high as 50x), carry risks — automatic liquidations and funding-rate costs can rapidly amplify losses for retail investors who don’t fully understand the mechanics. He argued the market has become increasingly speculative and questioned whether these contracts serve investors’ long-term interests.
Not everyone shares that caution. Intercontinental Exchange CEO Jeffrey Sprecher said last week that ICE — the parent of the New York Stock Exchange — is studying Hyperliquid’s model and talking with regulators about why traditional venues couldn’t offer similar products. His comments underscore how established exchanges are weighing whether to adapt to the popularity of perps rather than cede the space to offshore or unregulated venues.
Regulatory approvals and product launches are accelerating in the U.S. After the CFTC approved the first regulated crypto perpetuals for U.S. participants on May 29, several market moves followed quickly:
- Kalshi launched Bitcoin perpetual futures after the approval and rolled out Ethereum perpetuals on June 4.
- Filings show another 11 crypto perpetual contracts — including Solana and Dogecoin — remain under review.
- Coinbase Financial Markets received guidance enabling eligible U.S. institutional clients to access perpetuals and options listed on Deribit, which Coinbase acquired in 2025.
- Kraken announced plans to offer regulated Bitcoin perpetual futures via Bitnomial Exchange, a regulated platform its parent company Payward acquired earlier this year.
Meanwhile, Hyperliquid remains one of the largest decentralized venues for perpetual futures trading, a scale that has made it increasingly hard for regulators and traditional exchanges to ignore. According to reported figures, by May 20 the platform had generated $255 million in revenue for the year, and its native HYPE token had jumped 101% over the same period.
The FCA notice puts Hyperliquid under direct scrutiny in the U.K., even as major players and regulators in the U.S. move to fold perps into regulated markets. The coming months will likely determine whether regulated exchanges can build comparable products that balance demand with investor protections — or whether decentralized venues will continue to draw traders and regulatory attention.
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