PerpDEXs's regulatory sword of Damocles
Does Hyperliquid have connections all over Washington?
I'd like to share a very interesting discovery with you all.
Six months ago, in May, the CFTC publicly solicited opinions on the regulation of crypto derivatives/DeFi. In two letters submitted by Hyperliquid Labs to the CFTC, the name of former CFTC Chairman Giancarlo was prominently featured at the end:
As legal counsel, I assisted Hyperliquid in drafting a letter to legalize the U.S. perpetual contract.
Giancarlo, nicknamed CryptoDad, was instrumental in launching Bitcoin futures.
On October 13th, Hyperliquid announced the launch of the HIP-3 mainnet on DC.
Twelve days later, on the 25th, Trump announced his plan to nominate Mike Selig, the current chief legal counsel for the SEC's cryptocurrency group, as the new chairman of the CFTC.
Christopher Giancarlo @giancarloMKTS
Mike Selig @MikeSeligEsq
Keen observers in the English-speaking section have already discovered that Mike Selig was once Giancarlo's intern assistant? They worked together at the CFTC as "mentors" for 15 years.
However, I continued to investigate the Willkie law firm that participated in drafting the letter.
A LinkedIn post revealed that the two individuals' career timelines overlapped for three years at this law firm.
● Giancarlo has served as Senior Advisor and Co-Chairman at Willkie since 2020—to date. ● Mike Selig has served as Legal Advisor at Willkie since 2022, was promoted to Partner in 2024, and left the company in March 2025.
Therefore, Selig was still working at this law firm for the two months before HL filed its letter with the CFTC.
Looking back at last week, Giancarlo, in an interview discussing perpetual contracts, emphasized:
"Perpetual contracts are not illegal in the United States, but they must be traded on exchanges that have obtained a CFTC DCM (Designated Contract Market) license."
Then he praised his former colleague Mike Selig and made the following judgment:
Selig will be elected by the committee and then by the full council before Christmas, officially becoming the 16th Chairman of the CFTC by the end of this year.
Needless to say, the SEC has launched a full-scale offensive with Paul Atkins' "Project Crypto" speech, aiming to bring all of America's finance to the blockchain.
On the Federal Reserve side, on October 21, Governor Waller proposed the concept of a "simplified master account" at the Payments Innovation Conference, aiming to explore direct access for stablecoin issuers and crypto payment companies to the Federal Reserve's payment system.
Yesterday, BlackRock CEO Larry Fink said on Wall Street that tokenization is equivalent to the internet in 1996.
Look at Polymarket next door, which received a strategic investment of $2 billion from ICE, the parent company of the NYSE, on October 7, bringing its post-transaction valuation to $9 billion. The app launch is also on the agenda.
@shayne_coplan wants to bring PMs home, "so that Americans can freely trade their opinions."
Looking at Coinbase, a major player in compliance, it launched US Perpetual-Style BTC & ETH contracts in July that meet CFTC regulatory standards…
Hyperliquid's lobbying team is also quite impressive, so perhaps we can look forward to the day when our American friends across the ocean long QQQ at HL 20x?
Appendix: Two letters from HL Labs to the CFTC commenting on the "Comments on Perpetual Derivatives Trading and Clearing" | _2024111120230_ |
Comments Letter Regarding the "Draft Proposal for 24/7 Derivatives Trading" | _2024111120231_ |
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