Hyperliquid Policy Center Slams CME's Lawsuit as Attempt to Block Innovation

The Hyperliquid Policy Center (HPC) has filed an amicus brief urging the court to dismiss the CME's lawsuit against the CFTC. The HPC cited two defects in the CME's lawsuit, arguing that the exchange is trying to block innovation in the futures market.

The HPC noted that the CME relies on the doctrine of competitor standing to supply an injury, but that this doctrine applies only when government action intensifies competition in a fixed market. The HPC argued that the CFTC's approval of perpetual futures contracts does not meet this criteria and is therefore not a valid reason for the CME to challenge the regulator.

The advocacy group also claimed that the CME is an unsuitable challenger because its interests fall outside the zone of interests of the CEA provisions it invokes. This suggests that the CME may be motivated by self-interest rather than a desire to protect consumers or promote competition in the market.

Meanwhile, the Hyperliquid advocacy group accused the CME of attempting to halt innovation in the U.S. futures markets. The group noted that the CFTC's approval of perpetual futures contracts on Kalshi confirms that every U.S. derivatives exchange can list these types of contracts, and that the CME has chosen not to do so.

Hyperliquid is an offshore perpetual decentralized exchange that is eyeing entry into the U.S. market, and its parent company Payward is in advanced talks with Kraken's parent company to bring selected crypto perpetual futures to U.S. traders.