Did Futu's fines become a positive for Hyperliquid?

Author: Thejaswini M A

Translation and Compilation: BitpushNews

Bitpush Note:

On May 22, 2026, the China Securities Regulatory Commission dropped a heavy bombshell: planning to impose severe penalties on institutions like Tiger Securities, Futu Securities, and Changqiao Securities for illegal cross-border operations, not only facing hefty fines but also having all illegal gains from relevant domestic and overseas entities confiscated by law, and during a two-year crackdown period, fully shutting down related domestic businesses, with existing mainland clients only allowed to sell. Once this news broke, related US stock brokerages plummeted over 40% pre-market.

When compliant cross-border channels are gradually blocked one by one, where will the capital that still yearns to allocate global assets, participate in pre-IPO pricing of companies like SpaceX, or trade any asset at any time and place, flow to?

The answer seems to have already vaguely surfaced: flowing into RWA, flowing into Hyperliquid.

This is not prophecy. This is happening now.

On the same day the fines were announced, HYPE hit a new high.

Coincidence? Maybe. But capital never believes in coincidence. It only believes in exit.

Below is the main text:

CME Group (Chicago Mercantile Exchange) is the world’s largest derivatives exchange. It’s where professional traders buy and sell crude oil, gold, interest rates, stock indices, and Bitcoin futures. It handles trillions of dollars in transactions daily and has been around since 1898.

Intercontinental Exchange (ICE) owns the New York Stock Exchange and operates multiple derivatives exchanges worldwide. It’s another industry giant.

They are the most powerful financial market infrastructure companies on Earth. When they point to something and call it “highly dangerous,” regulators find it hard not to listen.

Currently, CME and ICE are pressuring the U.S. Commodity Futures Trading Commission (CFTC) and Capitol Hill to crack down on Hyperliquid, warning that this “KYC-free” platform is a hotbed for market manipulation and sanctions evasion.

These are indeed objective facts.

Affected by this news, the HYPE token fell 9% on May 15. Subsequently, two market makers withdrew $100 million in liquidity on May 18 in response.

coingecko.com

But pay attention to which product they are specifically targeting. It’s not the cryptocurrency perpetual contracts that have been running for years and have never caught regulators’ eyes; their focus is entirely on crude oil contracts. These contracts, during CME’s own crude oil market closure weekends, saw a trading volume of $720 million.

Regarding this regulatory pain point, CME and ICE’s concerns are not entirely unfounded, but we also know well that they are not neutral bystanders. Their business models depend entirely on a legally protected “trading time monopoly.” They don’t mind competing on technology, but when someone competes with them on timing, they go completely crazy.

By bringing real trading volume into the crude oil market over the weekend, Hyperliquid essentially breaks the spacetime continuum of TradFi. Meanwhile, vested interests are requesting the government to force others to close their eyes when they sleep. If it were me, I’d prefer to apply for a weekend trading license; but of course, that’s just my personal idea.

Hyperliquid’s office in Singapore has only 11 people. In the 30 days ending May 21, 2026, the protocol generated $51 million in revenue. In March, it handled up to $2.6 trillion in nominal derivatives trading volume.

tokenterminal.com

Hyperliquid routes 97% of trading fees through on-chain fund routing for HYPE token buybacks. Generating $51 million in monthly revenue with just 11 people, this per-capita economic efficiency is unmatched both inside and outside the crypto industry. As of late May, HYPE has risen 101% year-to-date.

All this isn’t necessarily because Hyperliquid has built a technically superior derivative. It’s simply because, when CME closes, Hyperliquid remains open, and that contains enormous value. Recently, some new developments have pushed this logic even further.

On May 1, the platform built on Hyperliquid, Trade.xyz, launched a perpetual futures contract for Cerebras, an AI chip manufacturer, pre-IPO. The contract ran for two weeks before the IPO. Early in that window, traders priced the stock at about 50% above the $185 IPO price, implying an opening price around $277. Market updates followed. One hour before Cerebras’ Nasdaq opening, Trade.xyz’s perpetual contract priced the stock at $340, within 3% of the actual opening price. Ultimately, Cerebras opened at $350 on May 14, soaring 89% above the $185 IPO price. Traditional primary and secondary market platforms like Forge and EquityZen had prediction errors of 35%, while Hyperliquid’s error was only 3%.

When genuine uncertainty still exists, $277 is the implied market price. As information flows in and is digested into prices, collective intelligence smooths out this gap. That’s how price discovery should work.

Then, on the morning of May 17, Sunday, Trade.xyz launched a SpaceX perpetual futures contract. It opened at a reference price of $150, soared to $216 within hours, and finally stabilized around $203, implying a market valuation of $2.4 trillion for the company.

However, at that time, SpaceX had not yet publicly filed an S-1 registration statement, nor had any Wall Street analyst issued a target price, nor was there any official roadshow.

Traders had no idea that SpaceX had already secretly submitted a confidential application to the U.S. Securities and Exchange Commission (SEC) on April 1, with a target valuation between $1.75 trillion and $2 trillion.

They settled the contract at $203, implying a valuation of $2.4 trillion. Before bankers held their first meeting and without access to the filing documents, the public keenly guessed the company’s own target range at the top end. Just a few days later, on May 20, Wednesday, SpaceX officially submitted a 277-page actual S-1 registration statement.

Currently, three products are trying to offer investors exposure to SpaceX’s investment risk. Each bets on a different legal approach.

PreStocks tries to be clever. They set up special purpose vehicle (SPV) funds to buy real SpaceX stock, then split these shares into blockchain tokens so retail investors can get a piece of the pie. It looks like a clean backdoor into private tech companies.

However, just before Hyperliquid launched its SPCX contract, Anthropic and OpenAI publicly disclaimed any connection to third-party SPV products claiming to track their valuations. Platforms in Hong Kong and the UAE have been selling tokenized exposure to these companies without board approval. Both companies issued warnings that the equity transfers behind these products are invalid. PreStocks’ tokens immediately plummeted 50%. When you try to operate by anchoring real stocks, the company behind the stock always retains intervention rights.

Ondo Global Markets tokenizes stocks through a registered U.S. broker-dealer, with each token backed by underlying securities. Its compliance is very clean, and the U.S. Depository Trust & Clearing Corporation (DTCC) is even building settlement infrastructure around it.

But Ondo’s biggest advantage is also its biggest weakness. It has a physical office address. If the SEC decides not to approve it, they know exactly which door to knock on. If Elon Musk objects, SpaceX’s lawyers know exactly which custodian to sue. Playing by the rules makes Ondo a perfect target for targeted strikes.

Then, looking at Hyperliquid’s SPCX contract — this thing is entirely built on emptiness.

No shares, no registered broker-dealer, and no claim to any physical assets. It’s a synthetic perpetual contract, a complete ghost. Purely a bet on a price quote, settled entirely in USDC on a decentralized network.

Even if SpaceX wanted to stop people from trading derivatives based on its valuation, it couldn’t. No corporate entity can serve legal documents, and no central issuer can exert pressure.

This is very clever. Hyperliquid has basically realized a principle: if you have no face, no one can punch you in the face. By anchoring the product to nothing physical, they become untargetable.

I’m not sure if that’s entirely a good thing.

A zero-KYC venue moving trillions of dollars around outside the global banking system is a national security nightmare that’s hard to argue against. Hyperliquid co-founder Jeff Yan flying to Washington on May 17 to meet policymakers shows how real this pressure is.

Speaking of Jeff Yan. He’s a real person, has shown his face, and went to Harvard. If SpaceX tries to sue him for trademark infringement or IP violation because he listed a contract called "SPCX," they can definitely serve legal papers directly to him.

But suing Jeff doesn’t make this contract disappear.

With PreStocks, if the company deletes the underlying stock, the product ceases to exist. With Ondo, if a judge freezes the bank or custodian, the product gets stuck. But Hyperliquid’s SPCX is a piece of self-deployed code. Even if Jeff Yan is sued into oblivion, the smart contracts are already live, the code is immutable, and the global order book continues to operate on-chain.

That’s the “flawless” theory of decentralization. Reality is more fragile. Hyperliquid runs on only 20 validators, not 900k. These validators can be identified. The JELLY incident already shows: if they want to intervene, they will. Validators are not immutable.

And again, time is the only product they cannot replicate.