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Judge Lets Stock Perpetual Futures Keep Trading but Says CFTC Likely Overstepped Its Authority
A federal judge refused to halt stock perpetual futures on Kalshi, Coinbase Derivatives and Bitnomial but found a Cboe- and Citadel Securities-backed group likely to prove the CFTC exceeded its authority.
Dextape brief
A federal judge in New York declined to halt stock perpetual futures on Kalshi, Coinbase Derivatives and Bitnomial, though she said the challengers are likely to succeed in arguing the agency exceeded its powers. Judge Valerie Caproni denied the emergency request on November 3, hours after the Commodity Futures Trading Commission said the products could start trading on U.S.-regulated exchanges. The suit, brought by the Capital Markets Alliance Association, names the CFTC and its chairman and targets approvals for all three exchanges. The judge wrote that the contracts appear to be swaps, which would fall under the Securities and Exchange Commission rather than the CFTC. The order leaves the approvals in place and does not decide the case. The CFTC's response is due November 6.
Why it matters: The dispute could shape how regulators classify perpetual contracts, a product central to crypto derivatives trading.
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Terms in this story
- Perpetual futures
- Futures with no expiry date, the most traded crypto derivative.
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