UK Financial Regulator Warns Against Hyperliquid as Crypto Perpetuals Face Increased Scrutiny

The UK's Financial Conduct Authority (FCA) has warned consumers against the crypto derivatives platform Hyperliquid, stating it may be operating without authorization. The warning comes as Hyperliquid's 24/7 perpetual futures market sees rapid growth, attracting scrutiny from traditional exchanges CME Group and ICE, which have raised concerns about market manipulation with the U.S. CFTC.

FCA warning against Hyperliquid

• ▪The FCA stated Hyperliquid may be providing or promoting financial services in the UK without authorization.
• ▪The FCA warned UK consumers to "avoid dealing" with Hyperliquid, noting they would not be covered by compensation or ombudsman services.
• ▪Kyle Samani of Forward Industries described the FCA action as the "first of many," signaling expectations of more regulatory attention.
• ▪The UK banned the sale of crypto derivatives to retail consumers in 2021 and expanded financial promotion rules to crypto in 2023.
• ▪The UK's Financial Conduct Authority (FCA) placed Hyperliquid and the Hyper Foundation on its warning list on May 21.

Hyperliquid perpetual futures growth

• ▪Hyperliquid's real-world asset open interest reached a record $3 billion, with its HIP-3 markets setting new records monthly since October 2025.
• ▪Hyperliquid is a decentralized exchange for perpetual futures, which are leveraged derivatives contracts with no expiration date.
• ▪By May 20, Hyperliquid had reportedly generated $255 million in year-to-date revenue.
• ▪The platform allows synthetic, 24/7 trading exposure to assets including stocks, commodities, and private companies.

CME concerns to CFTC

• ▪CME Group expressed concern that Hyperliquid's limited identity checks could enable market manipulation or sanctions evasion.
• ▪CME Group CEO Terry Duffy warned that crypto perpetuals could become a "disaster waiting to happen."

ICE concerns to CFTC

• ▪Executives from Intercontinental Exchange (ICE) raised concerns with the U.S. Commodity Futures Trading Commission (CFTC) about Hyperliquid.
• ▪ICE CEO Jeffrey Sprecher said the NYSE parent company is studying Hyperliquid's model.
• ▪Both CME and ICE warned that activity on Hyperliquid could affect global oil benchmarks if used by sanctioned actors.

CFTC perpetual futures framework

• ▪The CFTC also issued policy guidance on perpetual derivatives and 24-hour trading.
• ▪The U.S. Commodity Futures Trading Commission (CFTC) approved a Bitcoin perpetual futures contract from Kalshi for listing on a registered venue.
• ▪Hyperliquid remains outside the U.S. regulatory framework and blocks access to U.S. residents.
• ▪The Hyperliquid Policy Center stated the CFTC's actions were a "long-overdue acknowledgment" that perpetuals can support price discovery.

Hyperliquid regulatory compliance pathways

• ▪A regulated U.S. "wrapper" for Hyperliquid would likely require separate customer funds and a narrower list of products.
• ▪Venture capitalist Derek Edwards outlined five potential paths for Hyperliquid, including remaining offshore or seeking a regulated US structure.

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