May 29, 2025, is a landmark turning point in the history of cryptocurrency finance in the United States. With the annual turnover of global perpetual contracts exceeding 90 trillion US dollars and accounting for 75% of the absolute volume of encrypted derivatives trading, the US market has finally broken the long-standing ban and officially landed compliant local encrypted perpetual contracts. The CFTC has approved Kalshi to launch the first compliant Bitcoin perpetual contract in the United States, while also allowing Coinbase to connect with global perpetual and options markets through overseas entities.

The implementation of this regulation is not a simple product expansion, but a formal compromise and recognition of traditional finance towards a new on chain trading system. It means that perpetual contracts born on the crypto native track have officially entered the mainstream financial system in the United States from "offshore grey varieties", while completely reshaping global asset pricing, trading rules, and industry competition patterns.

1、 Perpetual contract: Financial innovation that has been dormant for decades, erupting from the landing of the cryptocurrency industry

The theoretical prototype of perpetual contracts was first born in 1993, when Nobel laureate Robert Shiller first proposed the concept of "futures without expiration dates". The original intention was to provide flexible risk hedging tools for long-term assets such as real estate, without the need for asset delivery to complete risk management. However, due to the constraints of traditional financial fixed delivery systems and centralized clearing systems, this advanced concept has been dormant in the traditional market for decades and has never been implemented.

Until 2016, the BitMEX team completed a disruptive improvement based on the original theory, pioneered the capital rate mechanism, solved the problem of price anchoring for non expiring contracts, combined with high leverage design, and officially launched the cryptocurrency perpetual contract product. With its core advantages of no maturity delivery, unlimited holding, high leverage, and concentrated liquidity, perpetual contracts have rapidly disrupted the traditional derivative system.

Compared to traditional quarterly futures, perpetual contracts completely eliminate the tedious operations and additional costs of delivery at maturity and monthly transfers. Traders can freely control their holding periods, ranging from a few minutes to several months. At the same time, traditional futures liquidity is dispersed among the four season contracts, while perpetual contracts gather all market liquidity, with single cap trading efficiency, sliding point advantages, and compound interest effects crushing traditional categories.

The efficiency advantage directly triggers the market size. Data shows that the annual transaction volume of encrypted perpetual contracts has skyrocketed from $28 trillion in 2023 to over $90 trillion in 2025, surpassing the sum of the top ten countries in terms of global GDP; Among them, the growth rate of on chain perpetual contracts is the fastest, with a year-on-year increase of 346% in transaction volume by 2025, reaching a scale of 6.7 trillion US dollars. In daily trading, the trading volume of perpetual contracts is 10-15 times that of spot contracts, and the pricing power of the cryptocurrency market has completely shifted from spot contracts to derivative perpetual contracts. Market fluctuations, long short positions, and market sentiment are all driven by perpetual contracts.

2、 US Compliance Implementation: Two Separated Transaction Systems Forming Misaligned Competition

Against the backdrop of perpetual contracts becoming the pricing core of the cryptocurrency market, the compliance release by the United States has finally filled the long-standing gap in the domestic derivatives market. However, the compliant products launched this time have formed a distinct separation from the global offshore mainstream market, with completely mismatched customer groups, rules, and leverage between the two systems.

Under strict regulatory constraints, the leverage limit of compliant perpetual contracts in the United States is only 10 times. Relying on a strict fund isolation system, the company focuses on institutional level security and compliance, providing core services to Wall Street institutions and compliant allocation funds. The global offshore market generally adopts 50-100 times high leverage to attract active trading users worldwide with extreme flexibility, high returns, and no access restrictions.

This differentiation rule also explains the core logic behind the 30% surge in HYPE, the perpetual leader Hyperliquid token on the chain, on the day of regulatory implementation. Previously, there was a common misconception in the market that compliance platforms entering the market would seize the Hyperliquid stock market. However, the reality is exactly the opposite: the two types of platform users are completely non overlapping and their needs are completely disconnected.

Hyperliquid's revenue in 2024 is expected to reach $907 million, with no US users contributing to the entire transaction process. Its core customer base is active traders who pursue high leverage, high-frequency trading, and full category asset games, and will never be restricted from using a compliant platform with 10 times leverage; Institutional funds that pursue compliance, security, and fund custody have never ventured into the offshore on chain market.

More importantly, this regulatory implementation brings official compliance endorsement to Hyperliquid. The CFTC has officially recognized the financial instrument attributes of perpetual contracts for the first time, confirming their core values in price discovery and risk management, completely eliminating the ultimate risk of overall track closure, and setting the tone for the long-term development of the on chain perpetual track.

3、 Crushing traditional finance: Hyperliquid breaks category boundaries and wins Wall Street's attention

Compared to the limitation of US compliance platforms that can only launch Bitcoin as a single currency, the on chain sustainable ecosystem represented by Hyperliquid has already achieved full coverage of all asset categories. Based on the HIP-3 and HIP-4 governance proposals, the platform breaks through the boundaries of encrypted assets and supports commodities such as stocks, crude oil, gold, and natural gas, as well as equity of listed/planned companies such as NVIDIA, Tesla, SpaceX, OpenAI, and even covers predictive market categories, truly realizing global arbitrary assets and 24/7 uninterrupted trading.

Its real trading data is sufficient to prove its ecological strength: the platform's silver perpetual trading exceeded 4 billion US dollars on the peak day of the market, and the periodic trading volume of crude oil perpetual has repeatedly surpassed that of Bitcoin perpetual, completely entering the core territory of traditional financial giants such as CME and ICE.

The industry's perception has also undergone a complete reversal. The CEO of ICE, the parent company of the New York Stock Exchange, publicly admitted that the well-known traditional exchange volume has been surpassed by the low-key growth of Hyperliquid. Nowadays, Wall Street giants are actively researching their business models and underlying trading structures, attempting to replicate this on chain trading system. This on chain platform, which has only been established for two years without top tier venture capital investment, has become a benchmark for global financial infrastructure.

In addition, Hyperliquid has an absolute crushing advantage in transaction costs: futures fees are only 2 basis points, while spot fees are 5 basis points, far lower than the 4 basis point futures and 15 basis point spot fees of traditional centralized exchanges. Lower transaction costs, higher trading freedom, and a wider range of asset categories continue to guide global liquidity towards on chain ecological migration.

4、 Industry restructuring: perpetual contracts may disrupt the traditional derivatives ecosystem

The compliance and opening of perpetual contracts in the United States is not only a positive development for the cryptocurrency industry, but also a disruptive challenge to the traditional century old derivative system. Traditional futures were born in the offline era of manual call orders and limited time delivery, with designs such as fixed maturity dates, market breaks, and transfer costs, which are no longer suitable for the globalized and all-weather digital asset era.

The characteristics of perpetual contracts, such as no expiration, no market closure, no need to relocate, and concentrated liquidity, perfectly adapt to the current global capital circulation needs around the clock. Whether it's geopolitical conflicts, sudden market trends at night, or real-time fluctuations in individual stocks and commodities, users can fill the trading gap in traditional finance by deploying perpetual contracts in real-time.

As the track matures, perpetual contracts are continuously squeezing the market space of traditional futures and options. For the vast majority of ordinary traders, perpetual contracts have flexible leverage, simple operation, no time loss, and higher capital utilization, making them highly cost-effective compared to zero day options and short-term futures. Although options have unique advantages such as upper limit of losses and convex returns that cannot be completely replaced, simple long short games and trend trading demands have been fully absorbed by perpetual contracts.

Market competition also forces industry profit restructuring. After the entry of compliance platforms, the competition in the derivatives market has become intense, with industry fees continuing to decline and profit margins compressed. While Coinbase's derivatives business is expanding, the high profit spot business continues to shrink, which also confirms that perpetual contracts are becoming the core of industry traffic and revenue.

Conclusion: On chain finance opens up the next generation of global trading paradigm

The compliance and implementation of perpetual contracts in the United States marks a complete departure from the label of "niche speculation" in the cryptocurrency industry. Its original innovative financial products have officially gained recognition from top global financial regulators.

From decades old academic theories to the 90 trillion dollar super track, from offshore grey innovation to entering the mainstream financial system in the United States, the rise of perpetual contracts proves that on chain finance is not a supplement to traditional finance, but a next-generation trading paradigm that is more suitable for the digital age.

In the future, with the continuous improvement of compliance systems, the continuous on chain listing of all types of assets, and the continuous iteration of trading infrastructure, on chain finance with perpetual contracts as its core will continue to seize market share in traditional derivatives and reshape the global asset pricing power and capital flow pattern.