Key Takeaways
- • The CFTC said Tuesday that "equity perpetual futures," perpetual contracts tied to individual stocks, can now trade on CFTC-registered U.S. exchanges for the first time, according to Decrypt.
- • Chairman Michael Selig framed the move as part of his campaign to "onshore" perpetual products, following the CFTC's earlier clearance of Bitcoin perpetual futures for Kalshi.
- • The contracts were deemed approved as security futures products under the Commodity Futures Modernization Act of 2000, placing them under joint CFTC and SEC oversight.
- • The joint oversight framework rests on a March memorandum of understanding between the CFTC and SEC, which SEC Chairman Paul Atkins described as ending a regulatory "no man's land" for such products.
- • The approval comes as Coinbase has filed to list single-stock perps on names including Apple, Tesla and Nvidia.
Summary
The U.S. Commodity Futures Trading Commission has opened the door to perpetual futures on individual equities, bringing a derivative long popular in crypto markets into traditional stock trading for the first time. The agency said Tuesday that "equity perpetual futures" can now begin trading on CFTC-registered exchanges, according to Decrypt. Perpetual futures carry no expiration date, allowing traders to hold leveraged positions indefinitely as long as they meet margin and funding requirements. Until now, such products have been largely unavailable to U.S. traders.
Chairman Michael Selig described the action as the latest step in a push to bring perpetual products onshore. He pointed to his inaugural remarks directing the agency to use its tools "to onshore perpetual derivative products so that they can flourish in the U.S., subject to appropriate safeguards." The stock contracts extend the agency's earlier clearance of Bitcoin perpetual futures for Kalshi, which Decrypt reported earlier this year as the first true Bitcoin perpetual futures on a regulated U.S. exchange. Selig argued that regulated U.S. venues offer stronger protections than offshore platforms, saying the move "ensures that American investors and traders can access these products within the protections of the CFTC's proven regulatory framework, rather than being forced to turn to offshore, and often unregulated, venues." He made a similar argument last week, citing the record Binance hack as grounds for U.S. oversight of offshore exchanges.
Regulatory treatment is shared between agencies. The equity perpetuals were deemed approved as security futures products under the Commodity Futures Modernization Act of 2000, placing them under joint CFTC and SEC oversight. Selig credited a memorandum of understanding the two agencies signed in March with resolving the jurisdictional uncertainty that, in SEC Chairman Paul Atkins's words, had left such products in a regulatory "no man's land."
The approval fits a broader effort to bring perpetual products under U.S. supervision. The CFTC has floated plans to place crypto exchanges under federal oversight, dismissed a CME lawsuit challenging crypto perpetual futures, and cleared the way for Coinbase, which recently filed to list single-stock perpetuals on names such as Apple, Tesla and Nvidia. Selig framed the goal as ensuring "the new frontier of finance is built in the United States of America."
Chairman Michael Selig described the action as the latest step in a push to bring perpetual products onshore. He pointed to his inaugural remarks directing the agency to use its tools "to onshore perpetual derivative products so that they can flourish in the U.S., subject to appropriate safeguards." The stock contracts extend the agency's earlier clearance of Bitcoin perpetual futures for Kalshi, which Decrypt reported earlier this year as the first true Bitcoin perpetual futures on a regulated U.S. exchange. Selig argued that regulated U.S. venues offer stronger protections than offshore platforms, saying the move "ensures that American investors and traders can access these products within the protections of the CFTC's proven regulatory framework, rather than being forced to turn to offshore, and often unregulated, venues." He made a similar argument last week, citing the record Binance hack as grounds for U.S. oversight of offshore exchanges.
Regulatory treatment is shared between agencies. The equity perpetuals were deemed approved as security futures products under the Commodity Futures Modernization Act of 2000, placing them under joint CFTC and SEC oversight. Selig credited a memorandum of understanding the two agencies signed in March with resolving the jurisdictional uncertainty that, in SEC Chairman Paul Atkins's words, had left such products in a regulatory "no man's land."
The approval fits a broader effort to bring perpetual products under U.S. supervision. The CFTC has floated plans to place crypto exchanges under federal oversight, dismissed a CME lawsuit challenging crypto perpetual futures, and cleared the way for Coinbase, which recently filed to list single-stock perpetuals on names such as Apple, Tesla and Nvidia. Selig framed the goal as ensuring "the new frontier of finance is built in the United States of America."
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