CME Group will sue the CFTC over its approval of U.S. perpetual futures, challenging how regulators classify a fast-growing derivatives product.
Key Points:
- Terrence Duffy said CME plans to file litigation against the CFTC on Jun. 18.
- The dispute centers on perpetual futures, which have no expiration date.
- Duffy said the products should be treated as swaps under the Dodd-Frank Act.
CME Lawsuit
Duffy, CME Group’s outgoing chief executive, said on CNBC’s “Fast Money” on Jun. 17 that the exchange operator will sue the Commodity Futures Trading Commission over its approval of perpetual futures in the U.S.
The CFTC approved prediction market platform Kalshi in late May to offer Bitcoin (BTC) perpetual futures, often called perps. The contracts let traders speculate on price moves without owning the underlying asset.
Unlike standard futures, perpetual futures do not expire. Kalshi has since expanded the product line to other cryptocurrencies, according to the report.
Duffy said CME’s lawsuit will argue that the instruments are swaps under the Dodd-Frank Act. He also said CME holds exclusive licenses with benchmark providers, meaning related products would have to go through the exchange.
“We have an exclusive license with every single provider of the benchmarks,” Duffy said.
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CFTC Perps
Duffy said the litigation was developed with CME’s board over eight months. He said he was ready for the dispute and would not avoid the fight.
CFTC Chair Michael Selig defended the agency’s position earlier this week on “Fast Money.” He said the U.S. should allow regulated futures contracts with no expiration date, while ensuring the product is supervised domestically.
The dispute may shape how crypto derivatives are listed in the U.S. If CME wins, perps could face swap rules rather than the futures framework used in the CFTC approval.
The fight also reflects CME’s role in regulated crypto derivatives. The exchange built its market around benchmark-based Bitcoin and Ether (ETH) products, while newer venues now seek faster access to crypto-native structures.
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