The US Commodity Futures Trading Commission argued in a brief filed on Friday that CME lacks standing to challenge the approval of crypto perpetual futures. CME argues that contracts with no expiry date are in substance swaps and should be regulated as such. The CFTC replies that CME has not shown imminent financial harm, noting that its crypto futures volume has risen. The CFTC approved the first such bitcoin contract in May.

What it means: Perpetual futures are the most popular product on international crypto platforms, but until recently they were not offered on regulated US markets. The CFTC's decision to allow them opened the way for new players such as Kalshi to compete with traditional derivatives exchanges. CME, which dominates regulated futures, sees a threat both to its market share and to the logic of the rules. If the contracts are deemed swaps, they would face stricter requirements and would be hard to offer to retail investors. The case is not only about crypto, since the same model could extend to other underlying assets. The outcome will also show how freely the CFTC can interpret the law under the current administration. In Europe, retail perpetual futures count as derivatives and fall under MiFID II and ESMA's leverage restrictions, while some platforms offer them under investment firm licences. For investors, leverage on these products stays high risk whatever the court decides.

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