HPC and trade[XYZ] Urge CFTC to Allow Energy Perpetual Contracts in U.S. Market

The Hyperliquid Policy Center (HPC) and trade[XYZ], a third-party market deployer on Hyperliquid, have submitted a comment letter to the U.S. Commodity Futures Trading Commission (CFTC) recommending a regulated pathway for energy perpetual contracts to enter the U.S. market.

The two organizations are proposing that regulated market access be established for perpetual contracts tied to crude oil and natural gas. They also support 24/7 trading and are calling for regulatory recognition of blockchain-based infrastructure for trading, clearing and settlement.

According to information shared on X by @WuBlockchain, HPC and trade[XYZ] have also recommended that stablecoins and tokenized traditional assets be permitted as margin for these contracts.

The proposals would connect traditional energy markets with blockchain-based financial infrastructure while maintaining a regulated framework for U.S. market participation.

HPC and trade[XYZ] Submit Recommendations to CFTC

The Hyperliquid Policy Center and trade[XYZ] submitted their recommendations through a comment letter addressed to the CFTC, the U.S. federal agency responsible for regulating commodity futures, options and related derivatives markets.

Their proposal focuses specifically on establishing a regulated U.S. market access pathway for perpetual contracts based on crude oil and natural gas.

Perpetual contracts are derivatives designed to remain open without a fixed expiration date. They have become widely used in digital-asset markets, where continuous trading and automated settlement mechanisms are common.

The recommendation would seek to extend this type of financial product into energy markets while operating within a regulatory framework overseen by U.S. authorities.

The proposal represents an effort to establish a connection between the structure of perpetual contracts and commodities that play an important role in global financial and energy markets.

Proposal Calls for 24/7 Energy Trading

HPC and trade[XYZ] are also supporting 24/7 trading for the proposed energy perpetual contracts.

Traditional commodity markets generally operate according to defined trading schedules, while blockchain-based markets can operate continuously. The proposed model would allow market participants to trade crude oil and natural gas perpetual contracts around the clock.

Continuous trading could provide market participants with access outside conventional market hours. It would also align energy derivatives with the always-on structure commonly associated with digital-asset markets.

The organizations' recommendation specifically identifies 24/7 trading as part of a potential regulated market structure rather than simply proposing unrestricted access to commodity derivatives.

Stablecoins and Tokenized Assets as Margin

Another key element of the proposal concerns collateral.

HPC and trade[XYZ] recommend allowing stablecoins and tokenized traditional assets to be used as margin for energy perpetual contracts.

Margin is collateral posted by market participants to support derivatives positions. Traditional derivatives markets commonly rely on cash or other approved assets as collateral, while blockchain-based financial markets can use tokenized forms of assets.

Stablecoins are digital assets designed to maintain a stable value relative to an underlying asset, commonly a fiat currency. Tokenized traditional assets represent conventional financial or real-world assets through blockchain-based tokens.

Allowing such assets to serve as margin would provide a mechanism for integrating digital financial instruments into the proposed energy derivatives market.

The recommendation would require regulators to determine how these assets should be valued, managed and treated within an appropriate risk-management framework.

On-Chain Infrastructure Included in Proposal

HPC and trade[XYZ] are also calling for recognition of on-chain infrastructure for trading, clearing and settlement.

Blockchain technology can provide shared transaction records and automated processes for financial-market operations. Recognizing such infrastructure within a regulated derivatives framework would represent a significant consideration for regulators assessing how digital technology can be incorporated into established financial markets.

The proposal therefore extends beyond the underlying contracts themselves. It also addresses the infrastructure through which transactions could be executed, cleared and settled.

The recommendation could require regulators and market participants to consider how existing financial-market requirements apply to blockchain-based systems.

Potential Intersection of Energy and Blockchain Markets

The comment letter places crude oil and natural gas derivatives at the intersection of traditional commodities and digital financial infrastructure.

By proposing regulated market access, 24/7 trading, blockchain-based settlement infrastructure and the use of stablecoins and tokenized traditional assets as margin, HPC and trade[XYZ] are outlining a market structure that incorporates several characteristics associated with digital-asset markets.

The recommendations remain proposals submitted to the CFTC and do not represent an indication that the agency has approved the suggested framework.

The CFTC will determine how it evaluates the recommendations within the applicable regulatory framework. Any implementation would depend on regulatory decisions and requirements governing commodity derivatives markets in the United States.

For now, the submission highlights growing efforts to explore how blockchain infrastructure, tokenized assets and continuously traded derivatives could be incorporated into regulated U.S. markets.

Writer: Victoria Hale
Technology & Blockchain Writer

Victoria Hale writes about blockchain technology, digital infrastructure, and the intersection of emerging technologies with finance. Her articles explore how new protocols and systems are shaping the evolving digital economy.

She prioritises clarity and accuracy when explaining technical developments to a general audience.