Key Highlights
- The Hyperliquid Policy Center submitted recommendations to the European Commission as part of its MiCA review.
- HPC argues that crypto perpetuals should generally be assessed under the EU’s existing MiFID II derivatives framework.
- The group says regulatory classification should depend on a product’s structure and economic characteristics rather than the blockchain used.
The Hyperliquid Policy Center (HPC) has urged the European Commission to treat perpetual futures as derivatives under the EU’s existing MiFID II framework rather than determining their regulatory treatment primarily through the Markets in Crypto-Assets Regulation (MiCA).
According to an X post of October 1, following its submission to the European Commission’s review of MiCA. HPC said the filing is its first policy submission outside the United States.
The European Commission’s review comes as regulators assess how the bloc’s crypto framework applies to products that increasingly resemble traditional financial instruments, including perpetual contracts, lending products and decentralized finance services.
HPC says product structure should determine classification
Perpetual futures are derivative contracts that provide exposure to an underlying asset without a fixed expiry date.
HPC argues that their regulatory treatment should depend primarily on their contractual structure and economic function rather than whether the product is issued or traded on a blockchain.
The group said this approach would allow regulators to assess onchain perpetuals using the same principles applied to other financial derivatives.
That position is broadly consistent with existing ESMA guidance. In its 2024 guidelines on the qualification of crypto-assets as financial instruments, ESMA said derivatives referencing crypto-assets can fall within the MiFID II framework. ESMA also specifically noted the distinctive structure of perpetual futures while concluding that their economic characteristics can support classification as derivatives.
ESMA has already addressed some perpetuals
The European Securities and Markets Authority has separately warned firms about crypto derivatives marketed as perpetual futures or perpetual contracts.
In February 2026, ESMA said firms must assess whether such products fall within existing national product-intervention measures for contracts for differences (CFDs). Where a perpetual derivative meets the definition of a CFD, requirements can include leverage limits, risk warnings, margin close-out rules and negative-balance protection.
This means the regulatory question is not entirely new, although different perpetual products may require different classifications depending on their specific characteristics.
HPC is asking regulators to provide further clarity rather than create a separate category specifically for blockchain-based perpetuals.
HPC distinguishes perpetuals from CFDs
A key part of HPC’s submission concerns differences between traditional CFDs and some onchain perpetual markets.
The policy group argues that traditional CFDs generally involve a provider acting as the counterparty to a client, while some blockchain-based perpetual markets operate through order books where participants trade against other market participants.
HPC also points to features such as publicly verifiable funding payments, liquidations and transaction activity as factors regulators could consider when assessing the structure of these markets.
These are HPC’s arguments and do not represent a regulatory determination by the European Commission or ESMA.
EU regulators are already reviewing DeFi gaps
HPC’s proposal comes as European regulators examine areas of crypto finance that do not fit neatly into existing categories.
In September, the European Banking Authority (EBA) called for greater attention to crypto lending and access to decentralized finance under the EU’s regulatory framework.
The EBA noted that crypto lending was already active across at least 16 EU member states, while DeFi access and stablecoin-yield products raised questions about gaps in the existing rulebook.
The EBA’s work provides a broader regulatory backdrop for the Commission’s MiCA review. While crypto lending and perpetual futures are different products, both raise the question of whether existing financial rules adequately cover new forms of onchain activity.
For perpetual futures, HPC is arguing that existing derivatives rules can provide the relevant framework rather than creating another classification specifically for blockchain-based products.
Public blockchain data raises reporting questions
HPC also raised questions about how existing reporting requirements should apply to derivatives traded on public blockchains.
Orders, trades, funding payments and liquidations can generate publicly accessible onchain records. HPC argues that regulators should consider whether such records could satisfy some reporting requirements where the information is complete, reliable and accessible to supervisors.
The proposal does not mean that public blockchain data would automatically replace existing regulatory reporting. Whether onchain records can meet EU reporting standards would ultimately be determined by regulators.
MiCA does not cover all crypto financial products
The debate is partly rooted in MiCA’s scope.
MiCA establishes EU-wide rules for crypto-assets and related services that are not already covered by existing financial-services legislation. The regulation specifically excludes crypto-assets that qualify as financial instruments.
That distinction is important for perpetual futures. If a product qualifies as a derivative or another financial instrument under MiFID II, it can fall outside MiCA and instead be governed by the EU’s existing financial-market framework.
HPC’s submission therefore focuses on how regulators should draw that boundary for perpetual products.
Prediction markets raise a separate question
HPC’s submission also addresses prediction markets.
The group distinguishes contracts linked to financial variables, such as interest rates, inflation, or commodity prices, from contracts based on non-financial events.
Its position is that contracts tied to financial variables may have characteristics associated with financial derivatives, while contracts based on other events could raise different regulatory and public-interest questions.
The distinction could become relevant as European authorities consider how prediction markets and other event-based contracts fit within existing financial rules.
EU regulators are reviewing broader crypto questions
The perpetual-futures debate forms part of a wider regulatory review as European authorities consider how existing rules apply to newer forms of crypto activity.
MiCA covers crypto-assets and services that are not already regulated under other EU financial legislation, while ESMA continues to issue guidance on how specific crypto products should be classified.
For perpetual futures, the immediate issue is therefore less about creating an entirely new regulatory category and more about determining when an individual product falls within existing derivatives rules.
HPC’s submission adds an industry position to that discussion, calling for clearer guidance on how the classification should be applied to different types of crypto perpetuals.
The European Commission will consider responses to the consultation as it prepares its review of MiCA and assesses whether changes or additional guidance are warranted.
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