Multicoin Capital and the Hyperliquid Policy Center just filed a joint comment letter to the CFTC, backing the agency’s proposed framework for regulating prediction markets. The filing, submitted on July 27, advocates for the CFTC to be the sole federal cop on the beat for these contracts, using the Commodity Exchange Act as its badge.

Kyle Samani, who co-founded Multicoin Capital and departed the firm in early February 2026, has publicly criticized Hyperliquid. Meanwhile, the firm he built reportedly holds over $40 million in HYPE tokens. The strategic arm is zigging while the departed founder zags.

What the letter actually says

The joint comment targets the CFTC’s proposed Regulation 40.11, a framework designed to bring some order to the prediction market Wild West. The letter makes three core arguments.

First, prediction markets should fall under exclusive federal oversight through the Commodity Exchange Act. No patchwork of state regulations, no jurisdictional turf wars. One regulator, one rulebook.

Second, the CFTC should use a “settlement-based assessment” to figure out what activities these contracts actually involve. In English: regulators should judge these products by how they resolve and pay out, not by the underlying topic they reference. A contract on an election outcome settles in dollars, not in votes.

Third, the CFTC should publicly disclose its decision-making processes when evaluating these markets.

The letter lands at a moment when prediction markets are no longer a niche curiosity. Monthly combined volumes recently exceeded $50 billion, with approximately $44.8 billion recorded in June 2026 across major venues.

Hyperliquid’s prediction market play

Hyperliquid launched its outcome contracts through a protocol upgrade called HIP-4 back in May 2026. These contracts are fully collateralized in USDC and non-leveraged. Settlement happens based on objective sources vetted by the platform’s validators, distributing that responsibility across a validator set rather than housing it in a single company’s server room.

The Hyperliquid Policy Center, the entity that co-signed this letter, appears to function as the protocol’s regulatory engagement arm.

The Samani paradox

Kyle Samani built Multicoin Capital into one of crypto’s most influential venture firms, with a particularly deep relationship with Solana, having participated in major funding rounds for the Layer 1 blockchain.

Samani left the firm in early February 2026. Since his departure, he has been critical of Hyperliquid, creating an awkward dynamic where the firm he founded is now actively partnering with a protocol he has publicly questioned.

Multicoin holds over $40 million in HYPE tokens according to available information. The message is clear: Multicoin’s institutional direction has diverged from its co-founder’s personal views.

What this means for investors

The HPC-Multicoin letter is essentially lobbying for a single federal regulator with clear, technology-neutral rules. The alternative, a state-by-state patchwork where New York says one thing and Texas says another, would be a compliance nightmare.

For platforms like Hyperliquid that have already designed their products around full collateralization and decentralized settlement, a federal framework based on settlement mechanics could be a significant tailwind. The risk is that registration requirements for prediction market exchanges could force protocols to either centralize key functions or exit the US market entirely.