Hyperliquid Criticized Over Permissionless Claims After MAS Alert

Popular investor and entrepreneur Kyle Samani has accused Hyperliquid of misleading the public over its permissionless status. The Forward Industries chairman made the claim after Singapore’s financial regulator added the platform to its Investor Alert List.

The Monetary Authority of Singapore (MAS) placed Hyperliquid on its Investor Alert List (IAL) on June 26. The IAL flags entities that residents may mistakenly perceive as licensed or MAS-authorized. An IAL listing carries no ban or enforcement weight. It signals, instead, that local users may not receive MAS protections if something goes wrong on the platform.

Hyperliquid Defends Its Permissionless Infrastructure

Hyperliquid responded to the Singapore IAL listing, noting that it has never claimed MAS licensing or authorization. The platform maintained that users retain full self-custody and all transactions settle transparently on-chain. It added that nothing about the network has changed.

Bybit received the same warning earlier in June. The MAS has been tightening oversight of offshore exchanges throughout 2026. It ordered unlicensed platforms to seek regulatory approval or cease operations accessible to Singapore residents.

Samani’s Case Against Permissionlessness

Samani took direct aim at Hyperliquid’s core claims.

Hyperliquid is not permissionless. Stop gaslighting the public.

Samani

He argued that genuine permissionlessness requires at a minimum two conditions. The protocol must be open source. Validators must also operate globally, not concentrated in a single location.

He further raised governance concerns. Samani said the Hyperliquid Foundation can jail validators and remove them from the active set without justification.

Furthermore, the Foundation can push forced software upgrades on validators, he argued, stripping them of control over their own nodes.

Hyperliquid’s current setup lends some weight to those claims. The network runs only 24 active validators and plans a modest expansion to 27. Its node repository distributes a signed binary rather than full source code. The team says open-sourcing will follow once HyperCore reaches feature completion.

FurthermoreThe hyperliquid foundation can put a validator in “jail” for any reason and remove it from active validator setThey also force upgrades on validators. They violate validator sovereignty

— Kyle Samani (@KyleSamani) June 26, 2026

Samani’s Motivations Under Scrutiny

Critics have previously targeted Hyperliquid on similar decentralization grounds, and the platform has typically held its position. Samani’s Multicoin Capital exit in February 2026 adds personal context. His former firm held notable exposure to competing protocols, prompting some observers to question his motivations.

How Hyperliquid responds to pressure from regulators and industry critics may shape its standing with institutional users in the months ahead.