Former US Regulators Urge Lighter Touch to Bring Crypto Perpetuals Onshore

Perpetual contracts, derivatives with no expiry date, use recurring funding payments to keep prices aligned with underlying assets. Once concentrated in cryptocurrency markets, they are expanding into equities and commodities as platforms such as Hyperliquid broaden their offerings. That growth has sharpened a central US regulatory question: whether a contract falls under the Securities and Exchange Commission or the Commodity Futures Trading Commission, and what compliance path applies.

The Hyperliquid Policy Center has submitted comments urging the SEC and CFTC to align how perpetual contracts are classified, supervised and enforced, seeking to prevent conflicting treatment of similar products tied to different assets. In a related push, the center and TradeXYZ called on the CFTC to create a pathway for US oil perpetuals. The reports disclosed no contract volume, dollar value or firm implementation date, leaving the agencies’ next steps uncertain.

Perpetual futures, or perps, resemble conventional futures but have no expiry, using periodic funding payments to keep prices close to their underlying assets. They have become a backbone of global crypto derivatives, with Bank of America estimating annual trading volume at about $90 trillion. DRW Chief Executive Don Wilson argues the instrument should not be conflated with practices common on offshore exchanges, particularly as round-the-clock contracts could offer hedging and price discovery across traditional markets.

The Commodity Futures Trading Commission cleared Kalshi’s Bitcoin perpetual and opened a route for Coinbase on May 29, 2026. Kalshi’s product surpassed $1 billion in volume within a week of its June launch. In comments published July 28, Wilson said high leverage and auto-deleveraging are exchange design choices, not inherent features of perps. Kalshi has since sought approval for gold and silver contracts, while CME Group sued the CFTC on June 18 over whether the products should be classified as futures or swaps.

Perpetual swaps are crypto derivatives with no expiry date, allowing traders to maintain leveraged exposure to assets such as bitcoin without owning them directly. BitMEX introduced the product in 2016, combining continuous trading with periodic funding payments between long and short positions to keep contract prices aligned with spot markets. That structure helped perps become a cornerstone of round-the-clock crypto trading.

CoinDesk reported on July 27, 2026, that annual trading in perpetual swaps is estimated at $40 trillion to $50 trillion, making them crypto’s largest financial instrument by volume. The market has expanded from BitMEX to centralized and decentralized exchanges serving retail traders, professional firms and hedgers. Their growth has broadened access to leverage, while also magnifying risks from volatile funding rates and forced liquidations.

Perpetual contracts have no expiry date and use funding rates to keep contract prices close to spot prices, making them suitable for assets such as bitcoin that trade around the clock. The U.S. Commodity Futures Trading Commission’s delineation of their appropriate use has implications for farmers and companies that use futures on corn, cotton and other commodities to hedge risk. It also signals that crypto-market structures will not be transplanted wholesale into physical commodity markets.

On June 23, 2026, CFTC Chair Michael Selig told the American Cotton Shippers Association’s annual convention that 24-hour perpetual contracts were not a natural fit for agricultural markets, which have limited trading hours and rely on physical delivery. The CFTC had approved Kalshi’s BTCPERP Bitcoin Spot Reference Perpetual Futures on May 29 and issued an interpretation and no-action letter concerning Coinbase’s application. The related documents did not disclose trading amounts.

Bitcoin perpetual futures have no expiry date, allowing traders to maintain leveraged positions over long periods through margin and funding-rate payments. Trading in the contracts has historically been concentrated on offshore crypto exchanges. Bringing them under U.S. Commodity Futures Trading Commission (CFTC) oversight would give retail and institutional investors a regulated channel while improving market transparency and investor protection.

In May 2026, the CFTC approved KalshiEX’s listing of the BTCPERP contract, marking the first entry of Bitcoin perpetual futures into the regulated U.S. market. The approval allows investors to trade a Bitcoin derivative with no fixed expiry under the U.S. regulatory framework. Reports did not disclose the contract’s trading volume, maximum leverage or formal launch date.

The U.S. Commodity Futures Trading Commission recently approved Kalshi, Coinbase and Kraken to offer crypto perpetual contracts in the United States, aiming to bring demand previously concentrated on offshore platforms under domestic oversight. These high-leverage derivatives have no expiration date, raising retail investor protection and market competition concerns among traditional institutions.

CFTC Chair Michael Selig has publicly defended the approvals, arguing that regulated U.S. markets can give retail investors better protections than offshore platforms and saying some incumbents are “afraid of the future.” Reports have not disclosed the exact approval dates, contract sizes or trading volumes, but they confirm that all three platforms have been authorized to offer the products in the United States.

Crypto perpetual contracts have no expiry date and allow traders to maintain leveraged positions indefinitely, but U.S. derivatives regulations have long constrained the products, pushing much of their trading volume to offshore platforms. Through “Project Crypto,” the CFTC is coordinating with the SEC on jurisdiction over DeFi, prediction markets and crypto assets, a process that will determine whether U.S. firms can legally offer such products.

In July 2026, CFTC Chairman Mike Selig said the agency would announce a policy to legalize crypto-asset perpetual contracts within a month and backed keeping crypto markets open 24 hours a day, seven days a week. The CFTC has opened initial approval pathways for companies including Kalshi and Coinbase as crypto derivatives trading volume sits near a two-year low.