‘Tough legal lift’ – Examining why Hyperliquid’s U.S. future is uncertain

In the United States, Hyperliquid is illegal, and the recent push for crypto perpetuals by prediction market platform Kalshi does not make the regulatory path any easier.  Clarifying the legal nuances between the two, Jake Chervinsky, chief of the Hyperliquid Policy Center (HPC), an advocacy group for the DEX, said,  Kalshi has a centralized registered DCM and will most likely offer traditional CeFi perps, which get different (easier) treatment under U.S. commodities law than DeFi perps. It will take longer for the CFTC to open the door for DeFi, a tougher legal lift. DCMs, or designated contract markets, are centralized exchanges that offer futures contracts and are overseen by the CFTC. Both Kalshi and Polymarket are registered DCMs.  For decentralized venues like Hyperliquid, however, it will need a ‘tougher legal lift,’ as Chervinsky puts it.  Will Kalshi crypto perps undermine Hyperliquid? Polymarket also announced its crypto perpetual plan, right after its rival, Kalshi, did. For the unfamiliar, crypto perpetuals, or perps, refer to contracts with no expiries but allow users to use leverage for higher potential gains.  The hot perps segment has made Hyperliquid earn a name for itself in the DEX space. And the diversification to tokenized assets perps has accelerated its market share. But some viewed the increasing competition from Kalshi, Polymarket, and other centralized venues as a threat to Hyperliquid.  However, some supporters think the threat is overblown. For his part, Ryan Watkins, co‑founder of Syncracy Capital, notes that Kalshi and other U.S. rivals remain constrained by regulation and leverage caps. Citing Coinbase’s regulated perps, he said they are capped at 3-10x leverage, while offshore CEXs and DEX perps can go beyond 50x. According to Watkins, DEX perps are cheaper and scalable.  Another user, Maven, claimed that 14% of Polymarket's top traders are already on Hyperliquid. In fact, he projected that the migration will accelerate when the DEX’s prediction markets (HIP-4) go live.  Meanwhile, the Kalshi and Polymarket perps update briefly dragged HYPE below $40. Interestingly, Nansen data showed that whales jumped on the dip and increased exposure by 19% as exchange supply dipped 22%, a bullish setup for the altcoin.  Final Summary Hyperliquid's U.S. legal clarity is unclear despite Kalshi and Polymarket’s crypto perps push.  However, Syncracy’s Ryan Watkins downplayed the likely impact of the U.S. rivals to Hyperliquid’s dominance