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Six firms including Coinbase, Kalshi and Payward asked a federal court for permission to file an amicus brief supporting the CFTC's authority over single-stock perpetual futures. Their application comes after the Capital Markets Alliance sued to overturn the CFTC's approval of the products; a court filing said applications from Coinbase, Kalshi and Payward were deemed approved on Nov. 2. The proposed brief argues the products are futures under a framework in which the SEC participated from the outset, not security-based swaps outside CFTC jurisdiction.
Why it matters
The Capital Markets Alliance, an industry association whose members include Cboe and Citadel Securities, contends that equity perps should be treated as security-based swaps because they have no expiration date. The association says the CFTC exceeded the SEC's authority by approving products that it says cannot be listed on CFTC-regulated exchanges.
The firms seeking to intervene dispute that interpretation. Their filing says the SEC and CFTC jointly sought public comment on whether perpetual contracts should be classified as security futures. Molly Abraham, Coinbase's general counsel, also argued that security-futures products under the Commodity Exchange Act and the framework Congress established in 2000 are not swaps.
Market impact
The case sets the regulatory path for stock-linked perpetual futures in the United States. Upholding CFTC authority would preserve the approval route for Coinbase, Kalshi and Payward to list equity perps, while rejection would place those plans under a materially different securities regime.
The dispute also carries broader implications for U.S. market access. Coinbase Vice Chairman Ryan VanGrack said global markets are already trading equity perps and that U.S. investors deserve access under the strong consumer protections and joint oversight of the CFTC and SEC. The ruling will determine whether that proposed U.S. market can develop under a unified futures framework.
Frequently asked questions
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Which firms are backing the CFTC in the equity-perps lawsuit?
Coinbase, Kalshi, Payward, DRW Holdings, Jump Trading and Paradigm are seeking permission to file an amicus brief supporting the CFTC.
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What is the Capital Markets Alliance challenging?
The CMA is seeking to overturn the CFTC's approval of single-stock perpetual futures. It argues that perps are security-based swaps because they lack a set expiration date.
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How do perpetual futures differ from traditional futures?
Perpetual futures let traders speculate on price movements without holding the underlying asset. Unlike traditional futures contracts, they have no expiration date.
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Why do the crypto firms cite joint SEC and CFTC oversight?
Their filing says the SEC participated from the start and that the agencies jointly sought public comment on classifying perpetual contracts as security futures.
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What market access decision rests on the lawsuit?
The case will determine whether U.S. exchanges can list stock-linked perpetual futures under CFTC approval with joint SEC and CFTC oversight, or whether they must follow a different securities regime.
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