Felix CDP
Rejected venues wait the longest for re-review; a rejection has to earn another look before the scheduled date.
Felix issues a synthetic dollar against collateral on Hyperliquid L1. The chain is the problem, not the protocol: Hyperliquid L1 fails our chain-level vetting, so nothing deployed only there is reachable for advised client money, whatever the protocol’s quality. TVL was $41.2M at the 2026-08-14 survey.
- Deploys meaningful liquidity on a chain the registry approves
- The Hyperliquid L1 verdict changes
The research file
Mechanism applicability
Felix documentation identifies its feUSD market as a Liquity V2-derived collateralized-debt system. Borrowers open collateral-specific Troves on Hyperliquid, post HYPE or other supported assets and issue feUSD at user-selected interest rates; feUSD holders can redeem through the system for collateral. This establishes the protocol identity and its dependence on Hyperliquid execution, oracles and collateral. It is not an individual review of feUSD solvency or parameters.
Current observation and chain fit
The DefiLlama protocol API read on 2026-08-15 showed about $29.9M of Felix CDP TVL and listed only Hyperliquid L1. Primary developer materials likewise identify WHYPE and Hyperliquid-native market contracts. The v1 rejected-chain dossier therefore remains directly applicable. Collateral branches, governance and upgrade roles, oracle construction, audits, incidents, peg performance and contract-by-contract correspondence remain deferred rather than presumed safe.
Exit applicability
Felix describes feUSD redemption as burning the stablecoin in exchange for a routed mixture of collateral from Troves, subject to oracle values, redemption iterations and a dynamic fee. Borrowers also depend on liquidation and stability-pool mechanics. Every one of those state changes, price inputs and returned assets settles on Hyperliquid L1, so protocol redemption cannot route around the rejected settlement layer. Secondary feUSD liquidity would retain the same chain dependency.
Why the class rule decides
The shared v1 rejected-chain dossier controls this application, not a protocol-quality conclusion. Reopen only if Hyperliquid L1 receives an approved chain disposition or Felix deploys a separately auditable, meaningfully liquid instance on an approved chain. A reopened file must then verify control, oracle, collateral and liquidation design, audits and incidents, feUSD backing and peg behavior, and stressed redemption liquidity. A new deployment or changed chain verdict would trigger diligence, not approval.
Sources
The claims above trace to these. Where a number could not be independently verified, the thesis says so.
- Felix Docs — feUSD CDP market · primary · accessed 2026-08-15
Supports: Liquity V2 design, Hyperliquid collateral, Troves, feUSD issuance, stability pool - Felix Protocol — CDP contracts and redemption design · primary · accessed 2026-08-15
Supports: collateral branches, feUSD redemption, oracles, dynamic redemption fee, Hyperliquid contracts - DefiLlama — Felix CDP survey record · secondary · accessed 2026-08-15
Supports: current TVL, Hyperliquid L1, CDP category
Inherited controls
The verdict above grades the protocol layer. Every position also inherits the asset it holds and the chain it settles on. The least safe layer sets the position’s grade, and the position table names which one that is.
| Chain | Verdict | Grade | Control constraint |
|---|---|---|---|
| Hyperliquid / HyperEVM | Rejected | freezable | a 21-validator permissioned set operates both the chain and its bridge — one compromise reaches both. |