Phantom Seeks CFTC OK to Route On-Chain Perps via Wallets

Phantom and the Hyperliquid Policy Center filed a request with the Commodity Futures Trading Commission on July 9 seeking clearer rules for non‑custodial wallets to route on‑chain perpetual futures orders to registered U.S. derivatives venues. The filing describes Phantom’s interface as a software-only front end that routes order instructions while users retain control of funds and private keys and registered firms handle execution and clearing.

The filing lays out a model in which a user’s wallet sends order instructions through Phantom’s software interface to registered exchanges, brokers and clearinghouses. Phantom already surfaces the Hyperliquid product through its interface, though U.S. users cannot access that product yet. The company said the current regulatory framework can create uncertainty for developers and wallet providers about whether their roles trigger registration obligations meant for intermediaries that hold customer funds or direct execution.

Phantom asked the CFTC for three specific clarifications. First, protocol developers should not be required to register solely for building on‑chain software. Second, registered exchanges and clearinghouses should have a clear path to perform execution, margining and recordkeeping on public blockchains. Third, non‑custodial wallets should not be treated as introducing brokers when they provide technical access to markets.

The filing cites a March no‑action position from the CFTC’s Market Participants Division that said staff would not recommend enforcement against Phantom for a specific software-access model if Phantom did not register as an introducing broker. That staff-level relief applied only to the facts Phantom presented and the division noted it could modify, suspend or end the position. In July’s submission, Phantom asked the full commission to codify a broader, binding version of the registered‑market‑access logic for wallets in similar positions.

To preserve investor protections, the filing attaches conditions including conflict and risk disclosures, independent user access to a registered collaborator, recordkeeping and marketing controls, and joint liability arrangements with the registered firms Phantom would connect to. The filing states that registered collaborators would continue to hold assets, control execution and handle margin and clearing even as the wallet becomes the user interface.

The CFTC issued an advisory on May 29 noting that 24/7 trading, clearing and settlement enabled by blockchain networks, stablecoins and smartphone apps can raise risks for liquidity, volatility, market manipulation and system reliability. The advisory said those features may require more intensive, real‑time surveillance and operational safeguards than many consumer apps currently have.

Industry developments show regulated perpetual crypto futures are arriving in U.S. venues. In May, two regulated U.S. exchanges began offering perpetual futures to domestic customers with leverage up to 50‑to‑1. Global perpetual futures volume in 2025 reached $61.7 trillion; a 1% share moving into regulated U.S. channels would equal about $617 billion and a 5% share roughly $3.085 trillion.

Phantom’s filing notes that wallet-based access could let traders keep tokens in their own wallets while using them as margin or collateral, removing a custody handoff. The filing also highlights that responsibility could be split among the wallet provider, the registered venue, the clearing entity and the trader if a user is liquidated, misreads a funding rate, or does not absorb a disclosure.

The filing outlines three possible regulatory outcomes: broader codified guidance allowing registered venues to plug into non‑custodial wallets under clear conditions; narrow, case‑by‑case relief leaving most onboarding in broker or exchange accounts while wallets act as distribution partners; or maintaining the current approach, keeping on‑chain perpetuals mainly offshore or geofenced from U.S. users. The CFTC’s response will determine whether regulated crypto derivatives can be accessed directly through standard wallet interfaces or remain tied to broker and exchange account structures.