Crypto exchange OKX built a decentralized perpetuals trading platform akin to Hyperliquid and Aster but held off launching it over regulatory concerns, its founder says.
The Web3 arm of OKX developed the unnamed platform in 2023, OKX founder and CEO Star Xu said in an X post on Sunday.
“Hyperliquid proved that massive success in onchain perps can be achieved with very few employees. Now, more competitors like Aster are stepping into the space,” he said.
“OKX Web3 has been testing a similar product since 2023, but we chose not to launch mainnet due to regulatory concerns.”
Decentralized perpetuals exchanges are booming
Decentralized perpetuals exchange Hyperliquid launched in 2024 and has become one of decentralized finance’s (DeFi) top perpetuals venues, logging its strongest month in July, with about $319 billion in trading volume.
Meanwhile, ASTER, which launched as Aster Chain in July, is a crypto derivatives exchange backed by CZ-affiliated YZi Labs and launched as a direct competitor to Hyperliquid. It has logged over $22 billion in trading volume in the last 30 days, according to DefiLlama.
Regulatory concerns shelved plans
Xu didn’t specify how far the product had come, but cited the Commodity Futures Trading Commission (CFTC) enforcement action Deridex in September 2023 as a concern.
In a 2023 enforcement action, the CFTC alleged that Deridex was illegally offering digital asset derivatives trading and failed to register as a swap execution facility or a futures commission merchant, taking particular aim at its perpetual swaps.
Other protocols, Opyn and ZeroEx, were also mentioned in the enforcement action for illegally offering leveraged and margined retail commodity transactions in digital assets.
“While we celebrate the growth of onchain perps, we should not forget the CFTC enforcement against Deridex in 2023. Regulatory enforcement has fundamentally shifted — hopefully the industry can soon gain much-needed clarity,” Xu said.
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Winds of change blowing
There has been a significant shift in the United States’ regulatory stance since the election of crypto-friendly US President Donald Trump in January.
On Saturday, the CFTC appointed new members to its Global Markets Advisory Committee and subcommittees, adding several crypto industry leaders to the Digital Asset Markets Subcommittee.
At the same time, the White House’s report on cryptocurrency policy, released in July, has recommended that oversight for digital assets should be shared between the CFTC and the Securities and Exchange Commission, with the CFTC having oversight over spot crypto markets.
Magazine: SEC’s U-turn on crypto leaves key questions unanswered