MarketsJun 23, 2026
Wall Street's Derivatives Giants Are Bracing for the Rise of Perpetual Futures
Derivative Evolution
Rhea Lobo
Discover
The Commodity Futures Trading Commission recently approved a class of derivative contracts called perpetual futures, or "perps," for the US market. The decision triggered a sharp selloff in shares of the country's largest exchange operators.
CME Group, Cboe Global Markets, Intercontinental Exchange and Nasdaq all slipped on the news.
A standard futures contract has an expiration date. When it expires, a trader must either settle the position or roll it into a new contract, which costs time and fees.
A perpetual future removes that expiration entirely. Traders can hold a leveraged position indefinitely, and the contract's price stays anchored to the underlying asset through a mechanism called a funding rate.
That is a periodic payment exchanged between buyers and sellers based on whether the contract trades at a premium or discount to the real asset price.
Perps also allow high levels of leverage, meaning a trader can control a large position with a small amount of capital.
When markets move against them, their positions can be automatically liquidated to protect the platform's reserves, a process called auto-liquidation. A single tariff announcement recently triggered more than $19B in liquidated leveraged positions.
Global trading volume in perpetual futures grew 29% in 2025 to $61.7T, driven largely by crypto traders on platforms like Binance and Bybit.
The CFTC approved prediction-markets platform Kalshi to list bitcoin perpetual futures in late May 2026. The agency also said it would not object to Coinbase Global allowing US customers access to its international perpetuals.
A broader regulatory framework was released, offering other registered US platforms a path to launching their own perps.
Within weeks of being listed, Kalshi's crypto perps surpassed $8.5B in trading volume. Coinbase, which has offered perpetual-style futures contracts in the US since July 2025, has recorded more than $211B in notional volume in those products.
Coinbase has since expanded the product line. It recently launched perpetual futures tied to stock indexes tracking artificial intelligence, China, defense, and the top 100 Nasdaq-listed companies, with up to 20 times leverage.
It also launched pre-IPO perpetual futures tied to private companies including OpenAI and Anthropic, allowing non-US retail traders to gain synthetic price exposure to firms before they go public.
CME filed a lawsuit against the CFTC arguing that perpetual futures are legally swaps under the 2010 Dodd-Frank Act, not futures.
The exchange claims the CFTC acted arbitrarily in classifying them otherwise and that the decision inflicts "textbook competitive injury" by letting Kalshi and Coinbase compete for its retail customers.
The CFTC called the lawsuit "frivolous" and said CME was conducting "lawfare" against the Trump administration's pro-innovation agenda.
"The incumbents don't like them because now there's competition."
Tarek Mansour, Kalshi CEO
Not every major exchange is taking CME's approach. Cboe is considering converting its continuous futures tied to bitcoin and ether, launched in December, into true perpetual contracts.
ICE said it's open to launching perps if it sees institutional demand. Nasdaq is monitoring developments before taking action.
The CFTC isn't done. It recently sought public comment on extending perpetual contracts and 24/7 trading to traditional energy derivatives.
CME and ICE have raised concerns about an offshore platform called Hyperliquid, where traders used perps to bet on oil prices during the Iran war while US markets were closed, and have pushed for it to register with US regulators.
Analysts at Piper Sandler noted that if the CFTC views 24/7 traditional futures as a potential volatility amplifier during stress, the case against approving perpetuals on those same asset classes is "arguably even stronger."
