The Hyperliquid ETF race is on
The crypto finance world doesn’t slow down. Bitwise, one of the most active digital asset managers right now, just filed a second amendment to its S-1 registration statement with the SEC for a Hyperliquid-backed ETF (HYPE). This update is far from trivial: the company is now integrating two new trading partners, Wintermute and Flowdesk, both well-known players in the cryptocurrency market as market makers.
For the uninitiated, a market maker is an entity that commits to constantly buying and selling an asset, ensuring there’s always liquidity on the market. In other words, they’re the ones making sure you can buy or sell without waiting for a miracle counterparty to appear. In the context of an ETF, their role is crucial to ensure the product functions smoothly day-to-day.
What exactly is an S-1?
The S-1 form is the official document a company must submit to the SEC (America’s financial watchdog) to register a new financial product for the general public. It’s, in a sense, the mandatory application file before you’re allowed to offer an ETF to American investors. The fact that Bitwise is already on its second amendment speaks to an iterative process and a clear desire to move quickly.
This updated filing comes at a particularly busy time: several companies seem to be positioning themselves simultaneously to launch financial products around HYPE, the native token of the Hyperliquid platform. The race is officially on.
Hyperliquid, the rising star of DeFi protocols
But actually, why all this enthusiasm around Hyperliquid? This decentralized trading platform has stood out in recent months for its remarkable performance and innovative model. Hyperliquid notably offers derivatives trading entirely on-chain, meaning directly on the blockchain, without a centralized middleman. All at execution speeds that make some traditional exchanges green with envy.
Its native token, HYPE, has attracted the attention of institutional investors, which explains the eagerness of asset managers to package this underlying asset in regulated wrappers accessible to the general public.
Europe takes the lead with a physical ETP
Timing is everything: the very day before this American filing, Bitwise Europe announced the launch of a physically-backed ETP (Exchange-Traded Product) on Hyperliquid, complete with a staking mechanism, on the Deutsche Börse Xetra platform.
An important distinction: a European ETP and an American ETF are two different products, subject to different regulatory frameworks. But the core idea remains the same: offering investors exposure to the HYPE token through a traditional financial instrument, without having to manage a crypto portfolio yourself. “Physically backed” means the issuer actually holds the underlying tokens, unlike synthetic products that use derivatives contracts to replicate performance.
Staking, meanwhile, lets you generate returns by participating in network security. It’s a bit like putting your savings in a savings account, but blockchain-style — with obviously very different risk profiles.
A well-oiled transatlantic strategy
This coordinated move on both sides of the Atlantic reveals a clearly deliberate strategy on Bitwise’s part. Launch first in Europe — where the regulatory framework is often seen as more favorable for this type of crypto product — while simultaneously advancing in the American market, larger but also more demanding in terms of regulatory approval.
Adding Wintermute and Flowdesk as trading counterparties also strengthens the credibility of the file submitted to the SEC. These two entities are references in the crypto ecosystem for their liquidity depth and operational expertise. A signal sent to regulators: this project wasn’t thrown together hastily.
Putting it in perspective
Bitwise’s offensive around Hyperliquid is part of a broader trend: following the smashing success of spot Bitcoin ETFs approved in the United States in early 2024, then Ethereum ETFs, the industry is now exploring how to expand this model to other crypto assets. Hyperliquid, with its explosive growth and unique positioning in DeFi, represents a natural target for this type of product.
That said, the path between an S-1 filing and final SEC approval remains fraught with administrative and regulatory hurdles. Recent crypto ETF history has taught us not to count our eggs before they hatch. What is certain, however, is that the battle to capture institutional interest around HYPE is only just beginning — and Bitwise intends to be front and center, not watching from the sidelines.