NYSE Parent Signs Deal to Bring Compliant Hyperliquid Perps to U.S.
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Intercontinental Exchange (ICE), parent of the New York Stock Exchange, announced a definitive agreement with Trade[XYZ] to bring the latter’s Hyperliquid perpetual futures to the U.S., pending regulatory approval.
As part of this deal, ICE will be the exclusive operator of Trade[XYZ]’s regulated markets and is also making a strategic investment. Notably, Wall Street legend Stan Druckenmiller is investing as well, making his first-ever tweet. HYPE, the native token of Hyperliquid, pumped ~20% on the news, from $78 to $94 at time of writing.
Hyperliquid will supply the rails via HIP-3* (note the asterisk), which is not exactly the same thing as HIP-3, the year-old protocol upgrade that allows third-party builders to deploy perps. HIP-3* is the newer, gated version designed for regulated entities. Trade[XYZ] will design and deploy the markets, and ICE will run the exchange and clearing. This partnership will allow for the creation of a KYC-gated venue with its own clearinghouse. It will list perps on equities, crypto, indices, commodities, and foreign exchange, with access through futures commission merchants (remember ICE’s venture with OKX).
Trade[XYZ]’s HIP-3 markets have done more than $650b in volume and will stay as they are. What makes this new partnership possible is HIP-3*. Hyperliquid unveiled it recently, and it’s live on testnet. It lets deployers run permissioned perpetual markets through an onchain allowlist. On Oct. 26, Hyperliquid announced that Payward, Kraken’s parent, plans to be the first CFTC-regulated deployer.
This is a huge announcement, but it’s not entirely surprising. President Donald Trump mentioned Hyperliquid on Aug. 19, stating that CFTC Chair Michael Selig was working to bring the platform to the United States. Also, ICE CEO Jeffrey Sprecher said he’d met the Hyperliquid team multiple times at investment bank Bernstein’s conference in May.
TradFi participants love to cite the oil use case. When ICE’s energy markets close, Hyperliquid keeps trading, which has proven useful in times of geopolitical duress.
Our take
U.S. traders will get a separate, permissioned venue with its own clearing. The existing open HIP-3 markets will keep trading 24/7 for everyone else. The liquidity will not be shared, meaning the U.S. venue will start from zero. It will be interesting to see how different books react to a Sunday night geopolitical shock, and how tightly arbitrage keeps the two prices together.
The backstop for HyperCore (the trading engine of Hyperliquid) is onchain liquidation and, in the tail, auto-deleveraging, as evidenced by last year’s devastating Oct. 10. Nothing announced so far says whether ICE’s clearinghouse will sit on top of HyperCore’s risk engine or replace part of it.
It’s also an open question whether ICE already owns any HYPE. Last month, Hyperliquid Labs, the software development company behind the blockchain, sold 3.75m HYPE OTC to an undisclosed institution. Prominent Hyperliquid onchain analyst MLM found 3.125M of it staked with the Hyperliquid Strategies x Unit validator. He traced the other 625k (through a few hops) to a wallet linked to Trade[XYZ], where it was staked this week.
This isn’t fully confirmed, though. It’s also uncertain whether trades on the planned U.S. venue would go through HIP-3 and pay the same protocol fees.
It’s a little ironic that ICE spent the spring lobbying against this sort of thing. Shortly before Sprecher’s Bernstein remarks, ICE and fellow trading colossus CME pressed U.S. officials to scrutinize Hyperliquid’s role in offshore, oil-linked trading.
This announcement is probably the largest positive catalyst in Hyperliquid’s short history, and it will be exciting to see how competitors in the perps space such as Lighter and Kalshi respond. What once seemed like a Hyperliquid bull’s wildest dream is now reality.
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