Hyperliquid founder proposes new regulatory approach: regulate trading service providers, not the blockchain itself.

BlockBeats news, October 15 — Hyperliquid co-founder Jeff Yan, in an interview on Bloomberg's "Odd Lots" podcast, proposed that regulatory obligations should be imposed on financial service providers operating markets on the Hyperliquid blockchain, rather than on the blockchain network itself, in order to reduce the compliance burden for the platform entering the U.S. market.

Yan compared this approach to internet infrastructure: the blockchain, as underlying liquidity and trading infrastructure, should not directly bear the full regulatory responsibilities of a traditional trading platform; instead, the service providers that actually operate markets and hold relevant control should fulfill compliance obligations.

Yan said Hyperliquid does not aim to replace traditional Wall Street financial institutions, but rather to provide them with underlying trading technology, similar to how Amazon Web Services (AWS) provides computing infrastructure for enterprises. He said the team is seriously working to build Hyperliquid into infrastructure covering various financial markets. Currently, Hyperliquid is still not open to U.S. users, but Kraken parent company Payward has planned to use its technology to offer derivatives services to U.S. investors through a regulated trading platform.