Hyperliquid Policy Center seeks five changes to SEC crypto rules

Regulation Crypto Assets follows years of enforcement-led oversight under the previous SEC chair, when lawsuits against Coinbase, Binance and Ripple treated most token sales as unregistered securities offerings. Commissioner Hester Peirce's 2020 token safe-harbor proposal never became binding rule, leaving airdrops, buybacks and secondary listings in a legal gray zone. Hyperliquid, the perpetuals-trading protocol, formed its Policy Center to help write the SEC's first real rulemaking attempt rather than keep fighting enforcement actions case by case.

If the SEC adopts the airdrop carve-out, projects could distribute free tokens without the act of distribution counting as 'consideration,' removing a trigger that has pushed teams to geoblock users or hire securities counsel before any giveaway. Exchanges and onchain protocols gain firmer footing to list exempt tokens, widening where holders can trade them. Builders avoid duplicate state-by-state compliance if federal preemption is written in, though that same preemption takes a tool away from state regulators who have used it against fraud.

A crypto-native exchange, not a trade association, is drafting the request for its own exemptions from securities law, a role usually filled by lobbyists at arm's length from the product they represent. Clearer airdrop and buyback rules could pull developers back from offshore structures, but stripping state securities authority through federal preemption reopens a states'-rights argument that predates crypto and rarely settles cleanly. Whether regulators treat one exchange's policy shop as a neutral technical voice is itself worth questioning. (per cryptopolitan.com)

The comment letter now sits in the SEC's public docket for Regulation Crypto Assets alongside submissions from other exchanges, custodians and law firms responding to the same proposal. The determining moment comes when the Commission issues a revised draft or final rule: adoption of the airdrop and preemption language would mark a rare case of an exchange's specific requests reaching statute, while silence on any of the five points would send Hyperliquid back to lobbying through enforcement defense instead.