CFTC opens equity perpetuals path as crypto legislation stalls

What happened

The Commodity Futures Trading Commission said Tuesday that perpetual futures on individual U.S. stocks may begin trading on federally regulated exchanges, Bitcoin Magazine reported. Chairman Michael S. Selig said the contracts, which the agency called "Equity Perps," were deemed approved under Commission Regulation 40.3 as security futures products. Venues would need a CFTC designated contract market registration and a notice registration with the Securities and Exchange Commission as a national securities exchange for security futures. The statement did not identify exchanges, contracts or a launch date.

In a separate track, the CFTC published an advance notice of proposed rulemaking on Oct. 5 seeking public comment on retail commodity transactions involving crypto assets and leverage or financing, Bitcoinist reported. The agency described the consultation as an early stage, not binding final rules. A central idea is a possible registration category called a "crypto asset market," intended for platforms that offer qualifying crypto commodity transactions under CFTC oversight. If adopted, it could give eligible exchanges a federal route to offer certain leveraged or margined spot crypto products and reduce reliance on state-by-state requirements for covered activities.

The CFTC has acknowledged that existing law does not empower it to require every crypto asset to trade on a federally registered platform without Congress. The proposal is therefore a possible pathway rather than a universal federal licensing system. Public feedback and the full rulemaking process must be completed before any framework takes effect.

Why it matters

The equity approval extends a contract structure that has been largely associated with offshore crypto trading into the U.S. equity market. For crypto platforms, the registration proposal points to a possible federal route for some spot products, while the equity perps bring margin, clearing and surveillance rules from two agencies around a product that previously sat outside U.S. jurisdiction. Selig has framed the issue as a choice between regulated access and forcing Americans to use offshore venues that he says lack comparable safeguards. The effect will depend on final rules, exchange participation and how courts and the SEC respond.

What the data shows

Bitcoin Magazine reported that the approval came five days after an Oct. 29 breach in which attackers linked by TRM Labs and Chainalysis to North Korea's TraderTraitor group drained about $6.3 billion from Binance hot wallets in roughly 20 minutes. Binance reopened withdrawals on Sunday and said it had replenished about 95% of affected assets. Selig told CNBC on Oct. 30 that the hack reinforced his argument about offshore exchanges and safeguards, and he cited the agency's October registration proposal.

Background

Perpetual futures have no expiration date. Instead of settling on a fixed day, longs and shorts exchange periodic funding payments intended to keep the contract near spot prices. The structure has dominated crypto derivatives, with most volume on platforms outside U.S. jurisdiction, according to Bitcoin Magazine. The CFTC approved the first U.S.-listed bitcoin perpetual, Kalshi's BTCPERP, on May 29, and Kalshi launched it soon after. The same day, staff granted no-action relief allowing Coinbase Financial Markets to route U.S. clients into offshore perpetual and options liquidity. Kalshi added gold and silver perpetuals in September. Selig described the equity contracts as an extension of the May decision beyond digital commodities into traditional securities.

The legal basis dates to the Commodity Futures Modernization Act of 2000, which created a joint CFTC-SEC regime for security futures; the agencies signed a memorandum of understanding on March 11 to coordinate rulemaking and enforcement. On Capitol Hill, the CLARITY Act, which would divide crypto oversight between the CFTC and SEC, failed to advance in a Senate procedural vote in September, Bitcoinist reported. The SEC has also pursued its own crypto rulemaking, creating a parallel effort.

What is still unclear

Several key details remain open. The CFTC's equity perp statement named no exchanges, listed no contracts and set no launch date, leaving those announcements to designated contract markets. CME Group sued the CFTC in June over the Kalshi bitcoin perpetual approval, arguing that a contract built on exchanged funding payments is a swap under Dodd-Frank rather than a future; that case is pending. An equity version adds SEC jurisdiction and may attract new objections from securities-side participants. The crypto registration proposal's scope also remains undecided until comments are reviewed and a final rule is completed.

What to watch

Market participants will watch for listing announcements from dual-registered exchanges, the next steps in the CFTC's crypto registration rulemaking, and any court ruling in the CME case. Congressional action on comprehensive crypto legislation, and SEC positions on security futures and crypto products, could also shape how far the agency's existing-authority approach can go.

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