Bloomberg: Hyperliquid is currently controlled by a small group of insiders and lacks formal regulatory oversight

ChainCatcher news, according to Bloomberg, Hyperliquid is currently controlled by a small group of insiders, raising questions about its level of decentralization. For supporters including Paradigm and Pantera Capital, it is both a bet on the future of digital finance and a reminder that the entire industry still operates outside of formal regulatory frameworks.

Essentially, Hyperliquid is a minimalist trading platform operated by a team of about 15 people at Hyperliquid Labs, based in Singapore. As per industry norms, the website front end blocks U.S. users, but anyone can trade on the blockchain that supports it. The lack of identity verification is part of its appeal, echoing an early pattern: rapidly growing trading platforms with similar models often quickly attract regulatory scrutiny.

If we compare HLP to an engine, then the validator nodes are the control room. Hyperliquid has about 24 validator nodes, while the Ethereum network has over a million. Critics argue that this leads to excessive centralization of power. The Hyper Foundation controls nearly two-thirds of the staked HYPE—its native token—thus holding significant influence in validator node decisions and governance, although in recent decisions, its nodes have chosen to abstain to respect community consensus.

Kam Benbrik, head of research at blockchain validator company Chorus One, stated, "If you control more than two-thirds of the stake, you basically can achieve control on-chain." Currently, Washington's relatively lenient stance provides room for Hyperliquid to grow. The question is, how long can it continue to operate outside of regulatory scrutiny?