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Hyperliquid, a decentralized exchange known for its onchain derivatives, opened a Washington policy office on February 18 and met with U.S. lawmakers to push for inclusion of its markets in the CLARITY Act. The effort comes as the bill advances in the Senate, signaling a potential regulatory window for crypto derivatives.

Background

The Commodity Futures trading Commission’s (CFTC) CLARITY Act, first introduced in 2018, is designed to bring futures and derivatives trading onto a regulated, cleared platform. While the Act originally targeted traditional exchanges, industry observers have argued that it could also apply to decentralized, blockchain‑based trading venues. Hyperliquid’s co‑founder Jeff Yan and policy team have framed onchain derivatives as offering greater transparency than legacy exchanges, citing publicly verifiable trade data on the blockchain.

What Happened

On February 18, Hyperliquid established the Hyperliquid Policy Center in Washington, led by Jake Chervinsky, a former chief policy officer at the Blockchain Association. The center’s mandate is to serve as a bridge between defi trading and the traditional regulatory apparatus. Co‑founder Jeff Yan met with legislators to explain the technical mechanics of onchain trading and advocate for its inclusion in the CLARITY Act’s regulatory scope. The meetings were described as a policy education effort aimed at lawmakers unfamiliar with decentralized markets.

Hyperliquid’s outreach also addressed criticism from traditional derivatives exchanges such as CME and ICE, who have warned about the risks of unregulated crypto venues. Hyperliquid countered that onchain markets provide improved transparency, with every trade, order, and liquidation publicly verifiable on the blockchain.

Meanwhile, the CLARITY Act itself has seen progress in the Senate, though it still faces roadblocks before a floor vote. Coinbase, a major crypto exchange, has publicly noted that more work remains on the bill, reflecting broader industry uncertainty about how the Act will be applied to digital assets.

Market & Industry Implications

Hyperliquid’s push could signal a shift in how decentralized derivatives are perceived by regulators. By positioning onchain markets as transparent alternatives to traditional exchanges, the company may influence lawmakers to consider broader regulatory inclusion. If the CLARITY Act is amended to cover DeFi platforms, it could create a clearer legal framework for operations, potentially attracting institutional participation and reducing compliance uncertainty.

Conversely, the stance of incumbents like CME and ICE highlights ongoing tension between established derivatives markets and emerging crypto venues. Their concerns about unregulated trading may shape the debate on whether the Act should be expanded to cover blockchain‑based derivatives or remain focused on traditional exchanges.

What to Watch

  • Upcoming Senate floor vote on the CLARITY Act – a key decision point for regulatory coverage of crypto derivatives.
  • Potential amendments to the Act that could explicitly include or exclude onchain derivatives markets.
  • Further policy engagements by Hyperliquid’s Washington office, including additional meetings with regulators or industry groups.