Felix CDP

Felix CDP remains outside the current firm shelf because it falls within the rejected-chain policy class. This firm policy judgment is not a negative quality rating or a client trade instruction. The sections below keep the facts about its mechanism, control, losses, and exits.

Review triggers: events that reopen the verdict
• Deploys meaningful liquidity on a chain the registry approves
• The Hyperliquid L1 verdict changes

Watched nightly: a warning on its venues or files, or a cited document that changes, reopens the memo. The first confirmation is due 2026-11-15.

The research file

Mechanism applicability

Felix documentation describes its feUSD market as a collateralized-debt system derived from Liquity V2. Borrowers open collateral-specific Troves on Hyperliquid, post HYPE or other supported assets, and issue feUSD at interest rates they select. feUSD holders can redeem through the system for collateral. These facts identify the protocol and its reliance on Hyperliquid execution, oracles, and collateral. They do not provide 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 also identify WHYPE and Hyperliquid-native market contracts. The v1 rejected-chain dossier therefore applies directly. The review does not assume that collateral branches, governance and upgrade roles, oracle design, audits, incidents, peg performance, or the match between records and individual contracts are safe. Those items remain unreviewed.

Exit applicability

Felix says redemption burns feUSD in exchange for a routed mix of collateral from Troves, subject to oracle values, redemption iterations, and a dynamic fee. Borrowers also rely on liquidation and stability-pool mechanics. Each of those state changes, price inputs, and returned assets settles on Hyperliquid L1, so protocol redemption cannot avoid the rejected settlement layer. Secondary feUSD liquidity would still depend on the same chain.

Why the class rule decides

The shared v1 rejected-chain dossier governs this case. It is not a judgment about the protocol’s quality. Reopen the review only if Hyperliquid L1 receives an approved chain decision or Felix deploys a separate, 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 prompt due diligence, not approval.

Class rule

The rejected chain class is outside the approved structures, so every protocol in it is not approved until the rule changes. The rule is about the structure, not an adverse finding about this protocol, and it is not a client instruction. The events that would reopen it are listed with the memo.

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 research above describes the protocol layer. Every position also inherits the asset it holds and the chain it settles on. The layer with the most administrative power sets the position’s effective control; that describes control, not quality or suitability.