Hyperliquid Policy Center Presses SEC on Buyback and Developer Rules

The Hyperliquid Policy Center has formally asked the U.S. Securities and Exchange Commission to revise its crypto market rules, targeting two areas it says remain unresolved: token buybacks and legal protections for developers.

The policy group, which operates alongside the Hyperliquid decentralised exchange, submitted its recommendations to the regulator as the SEC continues to review how existing securities frameworks apply to digital assets. The filing centres on how token repurchase programmes should be treated and how software developers should be shielded from liability when the code they write is used by third parties.

What does the submission ask the SEC to change?

According to the submission, first reported by CoinGape, the Policy Center argues that current rules leave issuers without a workable path to conduct on-chain buybacks. Traditional equity repurchases operate under clear disclosure and timing rules. Token issuers, by contrast, face ambiguity over whether a buyback triggers securities-law exposure or falls outside the existing framework entirely.

The second pillar of the request concerns developers. The Center pushes for protections that would separate writing and publishing code from operating a financial service. The distinction matters for decentralised infrastructure, where deployers of smart contracts often exercise no ongoing control over how users interact with the protocol after launch.

The submission frames both asks as market-structure questions rather than enforcement questions. Its core argument: without explicit rules on repurchases and developer liability, teams either avoid transparency or avoid building in the United States altogether.

Why buybacks sit at the centre of the debate

Token buybacks have become a recurring practice among crypto projects, with operators using treasury assets to repurchase their own tokens on the open market. The Policy Center's position is that regulatory clarity would let such programmes operate under defined disclosure standards comparable to those governing corporate share repurchases, rather than in a legal grey zone.

For the SEC, the topic touches a broader question it has been weighing across multiple proceedings: when a token functions as a security in the hands of a buyer, and when it functions as an operational instrument of a network. A buyback programme, by definition, treats the token as an asset the issuer itself values — a fact that complicates any argument that the token sits wholly outside securities law.

What happens next?

The SEC has not said whether it will open a formal consultation on either question. The Commission runs a public comment process through which industry bodies can file recommendations on prospective rulemaking, and submissions such as this one typically feed into that record rather than producing immediate changes.

The practical stakes are operational. Clear buyback rules would let treasuries manage token supply under supervision. Developer protections, if adopted, would reduce the personal legal exposure that currently deters some engineers from shipping decentralised infrastructure from U.S. jurisdictions.

The Policy Center's filing now sits with the Commission ahead of its ongoing review of digital-asset market rules, an agenda the SEC has signalled will continue through the current rulemaking cycle.