Hyperliquid Asks the SEC to Protect Airdrops and Buybacks: What It Means for HYPE Holders and Airdrop Hunters (October 2026)

What was actually filed

According to Cointelegraph, Bitwise Asset Management and the Hyperliquid Policy Center both submitted comment letters on Monday as the SEC closed public comments on its proposed Regulation Crypto Assets. The proposal would create exemptions for qualifying crypto fundraising and a conditional safe harbor for tokens tied to an investment contract. Blockhead adds the numbers: the proposal, released in August, would let a qualifying project raise up to 5 million dollars over as long as four years under a startup exemption, or up to 75 million dollars in any 12-month period under a separate fundraising exemption. The docket is S7-2026-27.

Bitwise asked the SEC to explain how an investment manager should decide whether a crypto asset is a security using publicly available information, and how to treat tokens when the issuer has not filed the proposed Form TR, the certificate that an investment contract has ended. That is a letter about fund managers and is mostly irrelevant if you trade for yourself.

The Hyperliquid Policy Center's letter is the one aimed at users of on-chain venues. Blockhead lists its five requests: write the SEC's March interpretation on airdrops into the rule text; use the SEC's Section 36 exemptive authority to allow conditional secondary trading, including on decentralized platforms; protect developers who are still building; separate automated buybacks that run on fixed, published rules from discretionary ones steered by a central party; and make federal preemption of certain state registration requirements permanent. Cointelegraph reports the group also argued that the proposed safe harbor could arrive too late in a project's life and that the proposal "fails to provide clarity" on whether unregistered intermediaries can facilitate token trading or whether tokens can trade freely through on-chain protocols.

Why airdrops are the part that touches you

An airdrop is a free token distribution to wallets that used a protocol. The legal worry is whether receiving one counts as buying a security. In Blockhead's account, the Policy Center wants the rule to adopt the SEC's March interpretation: if recipients give no tangible, definable consideration, the distribution is not an investment of money. The group argues that two common steps, connecting a wallet and passing sanctions screening, should not count as payment.

For a reader this matters in a concrete way. Projects that fear a securities claim tend to block users from certain countries, delay distributions or skip airdrops altogether. A clear rule would make it easier for a team to reward early users instead of selling tokens to them. It would not change what you must do to qualify for any specific airdrop, and it says nothing about taxes, which depend on where you live.

Why buybacks matter for HYPE

Blockhead reports that Hyperliquid uses its trading fees to buy back HYPE and that SEC staff already addressed buybacks in a crypto FAQ amended on 28 September, which says a buyback announcement is not a promise of managerial effort where the system is functional and has no central party. The Policy Center wants that staff position in the final text, plus an answer to what happens when someone can change a buyback's parameters.

If you hold HYPE, the line between an automated repurchase and a discretionary one is the part to watch. A written rule would reduce the chance that a buyback is read as a profit promise by a central party. Until then it remains a staff view, not a rule. Blockhead also notes that the platform has long blocked US users, so the practical effect on a trader outside the United States is indirect: it concerns how US-linked projects and venues treat tokens.

What Hyperliquid's own market data shows right now

We read the public Hyperliquid API at about 00:47 UTC on 21 October (08:47 Singapore time). HYPE had a mark price of 81.02 dollars against a previous-day price of 78.85, up about 2.75%. Its 24-hour notional volume was about 390 million dollars, and open interest was 20.38 million HYPE, roughly 1.65 billion dollars by our arithmetic (open interest times mark price). Across all listed perpetuals, 24-hour volume was about 5.59 billion dollars and open interest about 11.6 billion dollars. Bitcoin marked at 83,110 and Ether at 2,454, up 1.76% and 2.33%.

The hourly funding rate on HYPE was slightly negative at -0.00000784, which is about -0.0008% an hour, while BTC, ETH and SOL sat at the baseline 0.0000125 (0.00125% an hour). Slightly negative funding means shorts were paying longs a tiny amount; it is not a sign of crowded long leverage. The letter did not move the market, which fits the fact that the SEC has not acted.

What to do with this

You do not need to change anything because of a comment letter. Three habits are worth having. First, treat headlines about a proposed rule as a calendar item, not a trade: the SEC has said nothing about when it will vote, and former SEC enforcement official John Reed Stark and Duke scholar Lee Reiners asked it to withdraw the proposal entirely, so the final text could differ a lot. Second, if you chase airdrops, read the eligibility terms of each project and keep wallets and records tidy; the rule debate does not replace them. Third, if you trade perpetuals, check funding and liquidations before sizing a position; our funding board and liquidations page show both for the major venues.

If you want to trade on Hyperliquid itself, the Hyperliquid profile lists the fee schedule we track: 0.015% maker and 0.045% taker on perpetuals, and 0.04% maker and 0.07% taker on spot. Signing up with code NEXU888 in the Referrals section puts you on the NexuAlpha partner link, and the same profile explains the deposit steps.

What we could not verify

We could not read the Policy Center's letter on the SEC site directly, so its contents here come from Cointelegraph and Blockhead, which agree on the requests. We also did not find any statement from the SEC about whether it will change the proposal, and we found no sign that the letter affected today's HYPE price.

Quick answers

What did Hyperliquid ask the SEC to do? Make five changes to the proposed Regulation Crypto Assets, including writing the March airdrop interpretation into the rule and separating automated buybacks from discretionary ones.

Does this change anything for me today? No. The comment period closed on 20 October and the SEC has announced no vote date, so nothing has been adopted.

Is an airdrop a security? That is what the debate is about. The Policy Center wants free distributions to count as non-investments when recipients give no tangible consideration.

Did HYPE move on the news? HYPE was up about 2.75% in 24 hours to roughly 81 dollars on Hyperliquid's own data, in line with BTC and ETH, with no sign of a news-driven spike.

Where do I check funding and liquidations? On the funding board and the liquidations page.