CoinDesk
Coinbase, Kraken and Kalshi have backed the Commodity Futures Trading Commission in a court fight over perpetual futures tied to individual stocks. The firms argue the contracts are security futures, while a traditional securities industry group says they are security-based swaps.
The Capital Markets Alliance, backed by Citadel Securities and Cboe among others, sued the CFTC and sought an emergency halt to trading. Its case argues the products belong under Securities and Exchange Commission jurisdiction. A federal judge initially allowed trading to continue but indicated that the group's argument about CFTC overreach had merit.
The industry brief, whose signatories also include Paradigm, DRW Holdings and Jump Trading, says both the CFTC and SEC have treated the products as security futures.
Frequently asked questions
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What are single-stock perpetual futures?
They are contracts without an expiration date that let investors speculate on an individual stock's price movements.
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Why did the Capital Markets Alliance sue the CFTC?
The group argues that single-stock perpetuals are security-based swaps under SEC jurisdiction and sought an emergency halt to trading.
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Which firms support the CFTC's position?
Coinbase, Kraken and Kalshi signed the industry brief, along with Paradigm, DRW Holdings and Jump Trading.
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Has a judge halted trading in stock perpetuals?
A federal judge initially allowed trading to continue but indicated that the group's argument about CFTC overreach had merit.
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How do the firms describe the SEC's role?
Their brief says both the CFTC and SEC have treated the products as security futures.
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