Individual stock perpetual futures can now be traded on regulated American exchanges for the first time, as announced by the Commodity Futures Trading Commission on Tuesday, bringing a product previously limited to foreign crypto platforms directly into traditional equity markets.
In an official statement, CFTC Chairman Michael S. Selig noted that these agreements, which he referred to as “Equity Perps,” received official clearance pursuant to Commission Regulation 40.3 as security futures instruments.
Such products are permitted to list on trading platforms maintaining both a CFTC designated contract market registration and a notice registration with the Securities and Exchange Commission functioning as a national securities exchange for security futures.
“This advancement represents a major milestone toward enabling U.S. market participants, in accordance with applicable laws, to leverage the benefits of perpetual futures,” Selig stated. He emphasized that incorporating these products within the agency’s oversight structure means American traders no longer need to rely on “offshore, and frequently unregulated, platforms.”
These contracts fall under the jurisdiction of the Commodity Exchange Act, federal securities regulations, and the rulebooks of both regulatory bodies. The announcement did not name any specific exchange, enumerate specific contracts, or provide a release schedule.
Those operational specifics are anticipated to come directly from the designated contract markets themselves.
CFTC: From bitcoin perps to stock perps in five months
Perpetual futures lack any expiration date. Instead of settling on a designated date, buyers and sellers trade periodic funding fees that keep the contract’s valuation aligned with the spot price. This particular design has dominated the crypto derivatives sector for years, with the majority of trading volume concentrated on platforms outside American regulatory reach.
The CFTC authorized the initial domestically listed bitcoin perpetual, Kalshi’s BTCPERP, on May 29, and Kalshi launched the offering shortly thereafter. On that same date, agency staff issued no-action relief allowing Coinbase Financial Markets to direct U.S. customers toward foreign perpetual and options liquidity. Kalshi subsequently introduced gold and silver perpetual contracts in September.
During his Tuesday remarks, Selig characterized the equity-based contracts as an expansion of that May decision “beyond digital commodities and into traditional securities.”
The underlying legal foundation is more established. The Commodity Futures Modernization Act of 2000 established a shared CFTC-SEC framework for security futures products, and the two authorities executed a memorandum of understanding on March 11 to coordinate regulatory policy and enforcement.
Selig referenced both developments while echoing SEC Chairman Paul S. Atkins’s characterization of security futures as having been trapped in a regulatory “no man’s land” due to a lack of regulatory harmonization. Both agencies previously established a unified crypto asset classification earlier in the year.
Not all industry participants agree with the CFTC’s interpretation. CME Group initiated legal action against the agency in June regarding the Kalshi authorization, contending that a contract dependent on exchanged funding payments functions as a swap under the Dodd-Frank Act rather than a futures contract.
That litigation remains unresolved. Introducing an equity-based variant brings SEC oversight into the equation and could provoke a fresh wave of challenges from traditional securities stakeholders.
The onshoring argument after Binance
This regulatory approval occurs five days subsequent to the biggest theft in cryptocurrency history. On October 29, hackers identified by TRM Labs and Chainalysis as linked to North Korea’s TraderTraitor collective extracted roughly $6.3 billion from Binance’s hot wallets within approximately 20 minutes.
Binance restored withdrawal functionality on Sunday and reported that it has recovered approximately 95% of the compromised funds.
Selig leveraged the security breach to reinforce the argument he outlined in his Tuesday announcement.
“The core problem here is that these represent unregulated offshore exchanges, which lack the identical safeguards maintained within our financial markets here in the United States,” he explained during an interview with CNBC on October 30.
He argued that the security breach “validates our exact argument” concerning the agency’s October proposal, an advanced notice of proposed rulemaking aimed at establishing a voluntary federal registration pathway for digital asset exchanges equipped with cybersecurity, proof-of-reserves, and custody protocols. Selig has previously noted that the CFTC cannot mandate this registration without congressional authorization.
The approval of equity perpetuals operates on the identical underlying rationale. Perpetual contracts fueled the growth of the offshore derivatives sector; transitioning them onto dually registered domestic exchanges wraps them in the margin, clearing, and surveillance standards enforced by two federal agencies.
Selig framed the situation as a clear choice between regulated domestic access and “being forced to turn to offshore, and often unregulated, venues.”
Originally published at https://bitcoinmagazine.com/news/cftc-opens-equity-perpetual-futures.
