Hyperliquid Chief Jeff Yan Proposes U.S. Regulation of Market Platforms, Not Blockchain Technology

Hyperliquid’s founder, Jeff Yan, is urging U.S. regulators to concentrate on the firms that operate financial markets rather than on the underlying blockchain technology.

Speaking on Bloomberg’s Odd Lots podcast, Yan proposed that Hyperliquid’s Layer‑1 network be treated as shared financial infrastructure, not as a crypto exchange, so that regulatory duties would apply to the entities that build, deploy, and oversee market platforms built on it.

“Regulation belongs at the layer where controls exist, and the deployers are the ones who exercise those controls,” Yan noted.

This distinction is crucial for the crypto sector. A single blockchain can underpin multiple independent financial services, allowing the same infrastructure to host various market operators, each responsible for its own compliance obligations.

Yan emphasized that this is his preferred regulatory model, not a current legal classification under U.S. law. Although Hyperliquid is widely recognized for its perpetual futures platform, it remains inaccessible to U.S. customers.

Wall Street Integration

The proposal comes as traditional finance draws nearer to Hyperliquid’s technology. Payward, which owns Kraken, intends to provide U.S. investors with derivatives via Hyperliquid’s technology on a regulated exchange, Bloomberg reports.

“We’re not aiming to displace anything,” he said. “I believe this technology can benefit all market operators who work within traditional settings.”

These comments follow President Donald Trump’s August statement that the CFTC was pursuing federal regulations to bring Hyperliquid into the United States. Yan’s remarks indicate the company envisions a future where regulated operators use the blockchain infrastructure rather than the blockchain itself being registered as an exchange.

Regulatory Responsibility Question

The discussion highlights a broader challenge in decentralized finance: identifying who is responsible when financial services run on blockchain networks. While traditional exchanges operate under rules for trading venues and intermediaries, blockchain networks can decouple infrastructure from market functions, involving developers, operators, and users in overlapping capacities.

Yan argues that oversight should target entities that actually control financial markets. This approach could let institutions use shared blockchain infrastructure while adhering to regulations pertinent to their specific activities.

U.S. regulators will ultimately need to evaluate the exact activities and legal responsibilities involved. For the moment, the Hyperliquid founder’s message is clear: the network intends to serve as infrastructure for established financial institutions, not to replace Wall Street.

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