Key Highlights
- HPC submitted a comment letter to the CFTC supporting decentralized prediction markets.
- The firm urged flexible, function-based rules instead of centralized-focused regulations.
- Blockchain-based markets offer transparency, resilience, and improved price discovery- HPC.
The Hyperliquid Policy Center (HPC), an independent research and advocacy organization, submitted an extensive comment letter on Thursday to the U.S. Commodity Futures Trading Commission (CFTC) in response to the Advance Notice of Proposed Rulemaking (ANPRM) on Prediction Markets. The letter advocates for regulatory clarity that accommodates decentralized, blockchain-based platforms alongside centralized ones.
According to the official release, the letter makes a positive case for the use of permissionless blockchain technology to facilitate decentralized prediction markets.
What the notice focuses on
HPC asked the Commission to design flexible and functional regulations that can accommodate decentralized market systems and provide a legal framework for participation by U.S. citizens in decentralized markets, and promote the U.S. as a leader in decentralized financial innovation.
The CFTC published the ANPRM in March 2026 to gather comments on the application of current derivatives rules and core principles to the event contracts known as “prediction markets.”
While the notice largely focuses on operator-based platforms, HPC argues that the future direction of the federal derivatives regime lies with decentralized platforms running on open blockchains. This is because, since its inception, the derivatives market has been consistently pursuing innovations that enhance price discovery and risk management across new assets and trading models.
HPC highlights prediction market benefits
HPC highlighted the benefits of permissionless prediction markets, emphasizing that, unlike their centralized counterparts, decentralized platforms do not suffer from single points of failure due to the absence of custodians and central operators who manage customer balances.
Every trade and collateral is permanently recorded on the blockchain, offering end-to-end transparency to both regulators and users. Entry into the market is governed by consistent code-based policies, ensuring equality. Furthermore, on-chain data and positions are inherently composible with other DeFi primitives.
“Public, market-based prices are a public good,” the letter states, adding that prediction markets can aggregate dispersed information into price signals that often outperform traditional polling and expert analysis.
These features have contributed to the growing use of prediction markets across trading platforms, media outlets, and online platforms.
According to HPC, decentralization technologies can improve transparency, reliability, settlement security, and surveillance, directly contributing to the goals of the CFTC. The letter also warns against rules that are designed only for centralized exchanges, such as mandatory intermediaries or operator-based surveillance models.
Further developments
Separately, Hyperliquid recently expanded access to its decentralized perpetual futures platform through an integration with Trust Wallet. The integration provides access to over 200 perpetual markets and allows users to trade directly within the wallet environment.
Users can deposit funds from supported chains and start trading instantly, enjoying zero fees for the first three months.
CFTC’s role in shaping market
HPC’s response reflects a growing trend that decentralized prediction markets are capable of producing better price discovery and risk-sharing instruments. By pushing for adaptable and technologically neutral regulations, HPC strives to prevent American participants from being left behind in this rapidly evolving area.
As prediction markets become an influential factor in financial planning, politics, and economics, the route that will be taken by the CFTC now might dictate America’s role in this revolutionary segment of decentralized finance.
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