Hyperliquid Strategies applies for US FCM status, reports $620.6M profit
Hyperliquid Strategies says a subsidiary applied to become a US futures commission merchant and reported $620.6M quarterly net income, mostly unrealized HYPE gains.
Hyperliquid Strategies (NASDAQ: PURR), a listed company built around holding HYPE, said a subsidiary has applied for registration as a US futures commission merchant, or FCM. If approved, the entity plans to serve US clients trading perpetual futures on permissioned markets, according to Wu Blockchain. The Block reported that the filing was made with the CFTC.
The announcement came alongside results for the quarter ended September 30. The company reported net income of $620.6 million, a figure that Wu Blockchain and BeInCrypto both say came mainly from unrealized gains on its token holdings.
Profit driven by paper gains
Wu Blockchain reported $803 million in unrealized gains on HYPE during the quarter. The Block put revenue at $13.3 million. BeInCrypto said staking revenue and validator commissions made up $12.3 million, a small share next to the paper gains.
The Defiant noted that HYPE was trading about 14% below the price used to value the company's holdings at quarter-end. That means the reported profit reflects a valuation date and not necessarily where the token trades now. BeInCrypto also said the FCM bid still needs regulatory approval, which leaves PURR shareholders exposed to token price swings until then.
Buying and holdings
According to Wu Blockchain, the company raised $911 million in equity during the quarter. It spent $785 million of that to buy about 9.1 million HYPE, a figure Cointelegraph also cited. As of October 28, total holdings were about 38.9 million HYPE at an average cost of $56.35 per token, Wu Blockchain reported.
What the FCM would do
An FCM is a registered intermediary that holds customer funds and handles futures orders, BeInCrypto explained. The subsidiary would operate under HIP-3, which BeInCrypto described as a planned Hyperliquid upgrade that lets independent operators restrict who can trade on their markets. Wu Blockchain called the framework proposed. The company pitches the plan as regulated US access to perpetual futures, which are leveraged contracts with no expiry date.
BeInCrypto pointed out that the earnings release does not quantify any revenue from an FCM business. CoinDesk reported that the company wants full compliance for US client activity, but that the timing is uncertain.
What remains open
The FCM application has not been approved, and none of the outlets gave a decision date. HIP-3 is still described as proposed or planned, so the US perpetuals plan depends on that upgrade as well as on regulators. Until both are resolved, the company's reported results rest largely on the value of its HYPE holdings.
Sources
- Hyperliquid Strategies Posts $620.6 Million Profit on HYPE Paper Gains The Defiant
- Largest HYPE Treasury Firm Hyperliquid Strategies Seeks US Futures Commission Merchant Registration, Reports $620.6M Quarterly Profit Wu Blockchain
- Hyperliquid Strategies files to become CFTC-registered FCM, posts $13.3 million in quaterly revenue The Block
- Hyperliquid Strategies Is Betting US FCM Status Matters More Than Its $620.6M Profit BeInCrypto
- Hyperliquid treasury firm seeking U.S. regulatory nod as a domestic futures platform CoinDesk
- Hyperliquid Strategies seeks futures registration for perps Cointelegraph
Written with AI assistance from the sources above and checked against them. Not investment advice.