Kraken Enters US Crypto Futures Market with Hyperliquid

Kraken's parent company Payward, in line with its derivatives trading plan announced on September 16, is preparing to become the first market maker under US Commodity Futures Trading Commission (CFTC) oversight on decentralized trading protocol Hyperliquid. According to details shared on October 26, the integration went live on testnet with the HIP-3 upgrade, which aims to offer regulated perpetual futures contracts to US investors.

How will the Kraken and Hyperliquid partnership work?

The role of market distributor will be assumed by Bitnomial, which operates within Payward as a CFTC-licensed contract market and derivatives clearing organization. If the regulatory authority grants approval, Payward's registered futures commission merchant NinjaTrader Clearing will handle customer account carrying and custody. The official launch of the system remains subject to final approval from the CFTC.

How does the HIP-3 infrastructure meet regulatory requirements?

The developed HIP-3 protocol enables limiting market access through on-chain permission lists. This structure paves the way for licensed institutions to utilize Hyperliquid infrastructure while meeting regulatory requirements. Whether the permission mechanism will include built-in identity verification checks has not yet become clear. Hyperliquid, positioning itself as a neutral infrastructure layer supporting the financial system, stated that market control and legal liability remain entirely with distributor institutions.

Payward's initiative to open Hyperliquid-based perpetual futures to US investors through Bitnomial first surfaced in August. Hyperliquid Policy Center, which has also brought the process before regulatory authorities in the European Union, argues that licensed companies can operate compliant products on the protocol by setting leverage limits and on-chain access restrictions.

This content is for information purposes only and does not constitute investment advice.