CFTC Moves to Onshore Crypto Perpetual Futures in the U.S.

The U.S. Commodity Futures Trading Commission (CFTC) is actively working to establish a regulatory pathway for "true perpetual derivatives" to be traded domestically [1]. This initiative aims to bring the high-leverage "perp" market—which accounts for over 70% of global centralized crypto exchange volume—under U.S. oversight for the first time [1].

Key takeaways

• Perpetual futures, which allow for high leverage without expiration dates, reached a nominal $61.7 trillion in global trading volume in 2025 [1].
• The CFTC is currently involved in federal lawsuits against states like Wisconsin and New York to defend its exclusive jurisdiction over event-contract trading [2].
• Prediction markets like Kalshi and Polymarket are facing state-level accusations of operating unlicensed gambling platforms [2, 3].
• Analysts suggest that onshoring perps could introduce new volatility to U.S. markets, though regulators intend to implement safeguards to prevent the auto-deleveraging systems common on offshore exchanges [1].

Regulatory Clashes Over Market Jurisdiction

The push to onshore perpetual futures coincides with a broader legal battle between the CFTC and various U.S. states. While the CFTC seeks to integrate these novel derivatives into the domestic financial system, state authorities have increasingly targeted prediction market platforms, including Kalshi, Polymarket, Coinbase, and Robinhood [2]. Wisconsin recently joined a growing list of states, including New York, Arizona, Illinois, and Connecticut, that have sued these companies for allegedly violating local gaming laws [2].

CFTC Chairman Michael Selig has responded to these state actions by filing federal lawsuits to assert the agency's "exclusive jurisdiction" over event contracts [2]. Selig argues that these platforms provide a form of derivative activity that falls under federal, not state, authority [2]. In Arizona, a court recently paused a criminal prosecution against Kalshi, signaling that the federal agency’s argument regarding the preemption of state gambling laws may hold weight [2].

The Future of Leveraged Trading

Perpetual futures have historically been absent from the U.S. market, partly due to concerns regarding the auto-deleveraging systems used by offshore exchanges, which can trigger significant price cascades during periods of high volatility [1]. Analysts note that the success of onshoring these products will depend on how the CFTC structures pricing, settlement, and margin requirements [1].

While prediction markets have seen rapid growth—with Robinhood’s hub reporting 11 billion contracts traded in 2025—they also face scrutiny regarding potential insider trading and data manipulation [1, 3]. Despite these challenges, industry observers view the integration of prediction markets and leveraged crypto products as a "natural product extension" for existing platforms [1]. If the CFTC successfully establishes a framework for crypto perps, analysts speculate that the model could eventually expand to include traditional asset classes like the S&P 500 or commodities [1].

Why it matters

The CFTC’s efforts represent a definitive attempt to resolve jurisdictional ambiguity between federal regulators and state gaming authorities [2]. By creating a pathway for perpetual futures, the agency aims to bring a massive, high-risk segment of the crypto industry under domestic oversight, potentially reducing the reliance on offshore exchanges like the defunct FTX [1]. However, the ultimate success of this initiative remains subject to the outcome of ongoing litigation and the ability of regulators to mitigate the risks associated with high-leverage trading [1, 2].