S&P Global’s DeFi push begins with Hyperliquid
As S&P and Moody’s expand into digital assets, their frameworks could help Wall Street assess DeFi risk and enter the market with greater confidence.
I’ve been keeping a close eye on the Hyperliquid ecosystem over the past few weeks, but even I didn’t expect this morning’s news that financial titan S&P Dow Jones Indices would license its flagship S&P 500 for a perpetual contract on-chain via the project.
The news comes amid an oil- and geopolitically fueled run for Hyperliquid, which allows users to make bets through so-called perpetual contracts on-chain. S&P’s move will allow the S&P 500 to officially trade via XYZ 24/7, unlocking access to a product that sees roughly $1 trillion in daily trading volume. That dwarfs the current size of Hyperliquid’s markets, but the tie-up could prove to be a major tailwind for the DeFi darling, which in recent weeks has captured the attention of every major mainstream financial outlet.
This is a huge deal. There’s clear offshore demand to trade assets 24/7 with leverage, and now one of the largest financial products in the world will be at their fingertips. Here’s Cameron Drinkwater, Chief Product and Operations Officer at Dow Jones Indices:
“This collaboration expands access and utility of our flagship benchmarks within digital trading environments. We believe digitally native investors should demand the institutional-quality standards that define our indices, and we are thrilled to work with Trade[XYZ] to do so.”
S&P has been actively moving into digital assets and is not being shy about it. Here’s a running list of its activity, per today’s release:
This is a great sign for on-chain trading because the greenlight for the S&P gives users confidence that the products they trade on-chain will effectively track the same underlying constituents as those in traditional finance. It could also lead other index providers to license their products for on-chain trading. Ultimately, this opens the door to a wide range of fund products being traded on-chain.
Based on my doom-scrolling of LinkedIn, I expect this pace to accelerate. The firm currently has two job listings: Director, Business Development — Global Decentralized Finance and Digital Assets, and Director, DeFi Strategy and Planning. So not only are they licensing their products to trade on crypto rails, they are also hiring sales talent to push offerings that help institutions feel more comfortable wading into this nascent landscape.
As per the ad, the firm has ambitions to “build and execute complex sales processes for credit rating and stability assessments across digital bonds, tokenized real-world assets, and stablecoins.”
That will be the big unlock. I’ve been speaking with a number of executives at a crypto conference in DC, and the one problem I’ve heard repeatedly is that Wall Street doesn’t have the right tools to assess the risks of trading on these platforms. If they can’t get comfortable with counterparty and product risk, they won’t even begin the process of trading.
Once Wall Street can properly assess the risks of these assets and the platforms on which they trade, they can do the real work of deciding whether to enter with real capital. S&P isn’t the only firm looking to help Wall Street understand risk in digital assets. This morning, Moody’s announced it plans to bring analysis to blockchain financial infrastructure.
“Moody’s customers now have a new way to access trusted credit insight within the digital markets and on-chain finance workflows where they increasingly operate,” said Yuval Rooz, CEO of Digital Asset, co-founder of the Canton Network. “On-chain independent risk analysis streamlines distribution to permissioned parties, reduces friction, and improves transparency across the transaction lifecycle which strengthens market efficiency while preserving privacy, control, and compliance.”