Coinbase ($COIN), Kraken parent Payward and Kalshi are backing U.S. regulators in a court fight over whether exchanges can offer perpetual futures linked to individual stocks.…
Original source excerpt
Coinbase ($COIN), Kraken parent Payward and Kalshi are backing U.S. regulators in a court fight over whether exchanges can offer perpetual futures linked to individual stocks. The companies joined DR…
Coinbase ($COIN), Kraken parent Payward and Kalshi are backing U.S. regulators in a court fight over whether exchanges can offer perpetual futures linked to individual stocks. The companies joined DRW Holdings, Jump Trading and Paradigm in seeking permission to submit a friend-of-the-court brief supporting the Commodity Futures Trading Commission. Their filing responds to a challenge from the Capital Markets Alliance, whose members include Cboe ($CBOE) and Citadel Securities. The disagreement centers on how the contracts should be classified. The alliance argues that products without expiration dates should be treated as security-based swaps, rather than futures. That distinction determines which regulatory framework applies and whether the products can trade on futures exchanges. The supporting firms say the Securities and Exchange Commission participated in the process alongside the CFTC. Their brief argues that the agencies considered the classification question together and sought public input before the challenged listings took effect. Perpetual futures let traders maintain exposure to an asset's price without a scheduled expiration or ownership of the underlying shares. The disputed applications were deemed approved on Nov. 2, but the lawsuit now challenges the legal foundation for those listings. The immediate question is market access, not where any particular stock will trade next. A ruling could determine whether American exchanges can build this category of equity derivatives under the existing futures framework, or whether the products must follow a different regulatory path.
AI context is not available for this statement. The original source can be read independently.