CFTC Urged to Exempt Onchain Developers from Registration

Two prominent names in crypto have urged the Commodity Futures Trading Commission (CFTC) to exempt onchain developers from registration requirements. The Hyperliquid Policy Center and Phantom Technologies submitted a joint comment letter to the CFTC, arguing that writing code should not require a federal license. The core argument is that developers who publish onchain protocol software shouldn't be treated as Designated Contract Markets, Futures Commission Merchants, or any other regulated entity simply because their code exists.

The joint letter, submitted on July 9, lays out three specific requests targeting friction points in current rules and onchain infrastructure. First, they want the CFTC to confirm that developing and publishing onchain protocol software does not trigger registration requirements. In English: if you build a smart contract that enables derivatives trading, you shouldn't be treated the same as JPMorgan's futures desk.

The second request asks for updated guidance that would let CFTC-registered exchanges and intermediaries use onchain technology for their regulated functions. The third request formalizes no-action relief that Phantom already received in March under CFTC Letter No. 26-09, which established that Phantom's non-custodial wallet could connect users to registered derivatives markets without needing to register as an Introducing Broker.

The Hyperliquid Policy Center was established in early 2026 with the explicit goal of advocating for regulatory clarity around onchain markets. Phantom is a non-custodial wallet provider, essentially a window into blockchain activity, not a participant in it.