Hyperliquid Policy Center and Trade[XYZ] Petition SEC for Pre-IPO Perpetual Contract Rules

The Hyperliquid Policy Center and Trade[XYZ] have jointly asked U.S. regulators to establish a clearer framework for pre-IPO perpetual contracts, an emerging category of derivatives designed to give markets price exposure to companies before they go public.

The two organizations submitted a joint comment letter to the U.S. Securities and Exchange Commission (SEC) on August 18, 2026, responding to SEC Chairman Paul Atkins' May 2026 request for ideas on how to improve the initial public offering (IPO) process. The filing, submitted under File No. CLL-16, asks the SEC to consider regulatory rules for products known as IPOPs, or pre-IPO perpetuals. (Source: Official Letter)

Who Is Behind the Request

The Hyperliquid Policy Center describes itself as an independent research organization focused on regulated access to onchain markets, including markets operating through Hyperliquid. Trade[XYZ] is the largest deployer operating under Hyperliquid Improvement Proposal 3 (HIP-3), a framework that allows independent developers to create perpetual markets on the Hyperliquid blockchain.

The joint letter was addressed to Vanessa Countryman, Secretary of the Commission, and centers on creating a regulatory framework specifically designed for pre-IPO perpetual contracts. The organizations argue that these products could provide an alternative mechanism for price discovery before a company's shares begin trading publicly, an issue that matters because IPO pricing and the first public trade often diverge sharply.

Why Pre-IPO Pricing Is a Focus

The letter points to significant differences between IPO pricing and the prices at which stocks begin trading on public exchanges. According to the filing, the number of U.S. public companies has declined by about 40 percent since the mid-1990s, falling from more than 7,800 to roughly 4,700.

The groups cited several recent examples of substantial gaps between IPO pricing and opening-market prices:

• Cerebras priced its IPO at $185 before opening at $350.
• SpaceX priced at $135 and opened at $150.
• SK Hynix priced at $149 and opened at $170.
• China's CXMT priced its Shanghai listing at 8.66 yuan (approximately $1.28) before opening at 49.50 yuan (about $7.31) — a 472 percent increase from the offering price.

The groups argue that these price differences represent potential value that could otherwise be captured through additional market mechanisms.

Trade[XYZ] Highlights IPOP Results

Trade[XYZ] also presented historical data involving its IPOP markets, with all figures cited from the official letter:

• Cerebras: the IPOP remained active for 13 days before the company's May 14, 2026 listing, with the final IPOP price coming within 2.24% of the opening price.
• Quantinuum: the IPOP lasted 7 days before its June 4, 2026 listing, ending within 7.23% of the opening price.
• SpaceX: the IPOP operated for 25 days ahead of the June 12, 2026 listing and finished within 5.06% of the opening price.
• SK Hynix: the IPOP lasted 1 day before its July 10, 2026 listing and finished within 0.44% of the opening price.
• CXMT: the IPOP ran for 12 days before its July 27, 2026 listing, with the final price landing within 2.74% of the opening price.

Five Areas the SEC Is Asked to Review

The joint submission outlines five areas where the SEC could potentially establish rules for IPOPs:

1. Product classification: determining how equity-linked perpetual contracts should be classified, including whether they qualify as security futures or security-based swaps.
2. Disclosure: a disclosure framework tailored to the mechanics of these derivatives rather than traditional equity ownership.
3. Listing eligibility: requirements connected to the issuer's IPO filing process.
4. Market integrity: standards covering issues such as preannounced oracles and settlement mechanisms.
5. Investor access: a phased approach toward investor access, potentially expanding participation over time.

For now, IPOPs remain unavailable to U.S. persons. Trade[XYZ] says it uses geoblocking and wallet screening for U.S. and other restricted users.

Hyperliquid Trading Activity Draws Attention

The proposal comes as activity across HIP-3 markets continues to expand. According to data cited in the letter from the ASXN-Hyperliquid dashboard, HIP-3 markets have processed more than $450 billion in cumulative trading volume and maintain close to $4 billion in open interest. That scale helps explain why the proposal is drawing attention beyond a single product category, since any rulemaking around equity-linked perpetuals would sit inside a broader market that already has meaningful trading activity.

The letter also references a March 2026 SEC-CFTC memorandum of understanding focused on harmonizing derivative-product oversight, and points to a May 29, 2026 CFTC order approving the first perpetual futures contract listed on a U.S. exchange. Both agencies have identified equity-linked perpetual products as an area requiring coordinated regulatory consideration.

HYPE Token Data on August 19, 2026

Hyperliquid's native HYPE token was trading around $58.17 on August 19, 2026, according to CoinMarketCap data cited in the original report (CoinMarketCap chart). The token was down 2.89 percent over 24 hours, while its 24-hour trading volume stood near $256.2 million. Note: price data was sourced from a CoinMarketCap chart at the time of writing (August 19, 2026) and changes continuously, so figures may differ when this article is read.

HYPE had a market capitalization of approximately $14.68 billion and a fully diluted valuation of roughly $55.4 billion. Its circulating supply was approximately 252.51 million HYPE, compared with a total or maximum supply of 952.57 million HYPE. These market figures provide context for the size of the ecosystem surrounding the proposed regulatory discussion.

What Happens Next

The joint filing does not guarantee that the SEC will approve or adopt a regulatory framework for IPOPs. Instead, it represents a formal request for regulators to examine how these products should be classified and supervised. The SEC and CFTC would need to address questions involving investor protection, market integrity, derivatives regulation, and the relationship between private companies and blockchain-based price markets. For Hyperliquid and Trade[XYZ], regulatory clarity could potentially determine how quickly pre-IPO perpetual markets can develop within a compliant U.S. framework.

The SEC has not announced any regulatory approval resulting from the filing.