A new development on Hyperliquid’s testnet has sparked speculation that Kraken could be exploring a regulated version of decentralized derivatives trading.
The discussion began after Blockworks analyst Shaunda Devens discovered a test deployment labeled “Kraken HIP-3 test DEX” on Hyperliquid’s testnet. The deployment appears to be testing compliance and account-control features that are more commonly associated with centralized exchanges.
According to Devens, the system activated a permission feature known as Star gating on Aug. 19. So far, 10 wallets have been approved to access the deployment through a whitelist system.
The test has also reportedly used three compliance-related controls. These include the ability to cancel user orders, force the reduction of trading positions, and transfer collateral from user accounts.
These features would give an operator direct control over accounts and positions, allowing actions such as restricting access, responding to legal requirements, enforcing sanctions, or managing risk when necessary.
Such controls are standard at traditional centralized exchanges but are rarely seen in fully permissionless decentralized trading platforms.
The discovery has fueled speculation that Kraken may be experimenting with a compliant version of a HIP-3 market. However, there is currently no confirmation that Kraken owns, operates, or is connected to the deployment.
Because Hyperliquid’s testnet allows anyone to create deployments, it is possible that another user simply used Kraken’s name. A validator called “Kraken Exchange Validator” has also appeared on the network, but this likewise does not prove official involvement.
Neither Kraken nor Hyperliquid has publicly commented on the matter.
The testing revolves around Hyperliquid’s HIP-3 framework, which allows independent operators to launch perpetual futures markets using Hyperliquid’s trading infrastructure.
Under HIP-3, builders can create their own markets while relying on Hyperliquid’s matching engine, order book, margin system, and liquidation tools. Operators can decide which assets to list, what leverage to offer, and how their markets function.
Since launching on mainnet in late 2025, HIP-3 has become increasingly popular. Operators must stake 500,000 HYPE tokens to launch a market, providing a financial incentive to follow protocol rules.
The potential addition of permission controls would represent a significant shift. Instead of allowing anyone to trade, operators could restrict access to approved users, creating markets that combine blockchain settlement with compliance requirements and identity checks.
Whether these features will eventually be added to the main network remains unknown.
Interest in the test has also grown because Kraken has spent much of 2026 expanding its presence in both traditional and blockchain-based financial markets.
Earlier this month, Kraken launched stock trading services for eligible European customers, offering access to thousands of U.S. stocks, tokenized equities, and crypto assets through a single platform.
The company has also expanded its xStocks ecosystem, which allows tokenized versions of traditional stocks to be traded on blockchain networks. Since launching, xStocks has generated billions of dollars in trading activity.
Kraken has additionally introduced on-chain trading services and has been working to expand tokenized asset offerings into new global markets.
Because of these recent moves, some observers believe a regulated Hyperliquid deployment would fit naturally within Kraken’s broader strategy. Still, that connection remains speculation until the company confirms any involvement.
Even if a permissioned HIP-3 market eventually launches, regulatory challenges would remain. In the United States, offering perpetual futures products to retail traders generally requires approval and oversight from regulators.
Compliance controls could help limit access based on geography or user identity, but they would not replace licensing or registration requirements.
For now, the evidence only shows that a Kraken-branded deployment exists on Hyperliquid’s testnet and is actively testing compliance-focused features. Whether it is actually connected to Kraken, and whether these tools will eventually move to the main network, remains an open question.
