Author: Maher, Foresight News

On May 29, the U.S. Commodity Futures Trading Commission (CFTC) issued two landmark measures on the same day: formally approving the Bitcoin perpetual contract submitted by KalshiEX, LLC (Kalshi). In addition, the CFTC issued a no-enforcement letter to Coinbase, allowing Coinbase to offer certain perpetual futures products to U.S. customers through its subsidiaries.

The CFTC issued the "Perpetual Contract Listing Policy Statement", which provides a clear guidance framework for the listing of perpetual products in regulated markets. This combination of actions means that the regulation of crypto derivatives in the United States has taken a critical step from the long-term gray area to the compliance path of true perpetual contracts.

Kalshi and Coinbase receive regulatory approval

The CFTC review determined that Kalshi’s Bitcoin perpetual contract complies with the Commodity Exchange Act and the core principles of DCM (Designated Contract Market), including the depth and liquidity of the underlying Bitcoin spot market, contract design, risk management capabilities, etc. The approval order requires Kalshi to continue to operate in compliance, and makes it clear that the design of perpetual contracts "is not necessarily applicable to all asset classes." It encourages other market participants to communicate with regulators about perpetual products with different underlying targets and submit them through a formal approval process.

In addition, the CFTC Market Participants Division issued an explanation letter and a no-action letter to registered futures commission merchant Coinbase Financial Markets (CFM), allowing it to provide Deribit-listed crypto options and perpetual contracts to U.S. users. The letter confirms that the above-mentioned perpetual contracts can be classified as offshore futures under CFTC Regulation 30.1. Under certain conditions, the CFTC will not recommend enforcement action against CFM's transfer of digital commodities and payment stablecoins held by customers to its offshore brokerage affiliates for margin use, and the affiliates may exercise reuse rights over the above-mentioned client assets.

Previously, the U.S. market lacked true perpetual contracts (no expiry date). Coinbase Derivatives launched "perpetual style" futures through self-certification in July 2025 (with a contract period of up to 5 years), aiming to simulate the characteristics of a sustainable economy but still retain the expiration date. Today's approval and the lack of enforcement action provide a dual compliance path for "true sustainability": Kalshi takes the DCM standard futures route, and Coinbase reaches U.S. customers through foreign futures + crypto collateral.

Mike Selig

CFTC Chairman Mike Selig emphasized in his statement that perpetual contracts are an important risk management and price discovery tool for the global crypto asset market. The launch of true perpetual contracts in the United States is an important step in promoting the United States as a global crypto center. He pointed out that the CFTC has established a feasible regulatory framework for crypto asset perpetual contracts and will maintain market order by limiting excessive leverage, market volatility and systemic risks.

Selig also admitted that the CFTC’s current regulatory stance has not yet formed formal permanent rules, and future policies may still be adjusted as the regulatory environment changes.

Trillion market size cake

So why has the CFTC not approved a real Bitcoin perpetual contract before?

Perpetual contracts are "new" products within the traditional commodity futures framework. It has no expiration date and final delivery, which conflicts with the conventional understanding of traditional futures "must have an expiration date and convergence mechanism" in the Commodity Exchange Act. The CFTC has internally discussed whether to classify it as futures or swaps (swaps). Different classifications will bring completely different regulatory requirements (including clearing, margin, reporting obligations, etc.). This lack of clarity on legal status makes it difficult for platforms to obtain a solid compliance path.

In addition, its high leverage and speculative nature, as well as concerns about market manipulation, have always made the CFTC adopt a cautious attitude.

As a perpetual contract that tracks the spot price of Bitcoin, BTCPERP has no fixed expiration date and is regularly settled on both long and short sides through the funding rate mechanism to maintain a tight anchoring of the contract price and the spot price.

In the global crypto derivatives market, perpetual contracts have long dominated the market. According to data from CoinGecko’s 2025 annual report, the cumulative trading volume of crypto derivatives on global centralized exchanges is approximately US$85.7 trillion, with perpetual contracts accounting for approximately 78%. In 2025, perpetual contracts on decentralized exchanges will total approximately $6.7 trillion (+346% year-on-year).

Ironically, while regulatory traditionalists in Washington are arguing over compliance, offshore decentralized sustainable platforms represented by Hyperliquid have already extended their reach to the S&P 500, crude oil and gold through on-chain synthetic assets. As of the end of May 2026, Hyperliquid's perpetual trading volume has risen to US$586.12 billion. According to Allium on-chain data, Hyperliquid's total network derivatives positions also hit a historical high of nearly US$60 billion at the end of May, with more and more individuals and institutions choosing to trade on it.

Hyperliquid’s latest positions

This unprecedented approval by the CFTC is not only a compromise to the encryption market, but also an "onshore defensive battle" that the compliance world has to make in the face of the offshore innovation pressure of "all assets are sustainable".

In contrast, although regulated Bitcoin futures such as CME provide stable hedging tools for institutions, their leverage and trading characteristics are different from the perpetual products preferred by retail/professional traders.

This CFTC approval has undoubtedly opened up a new battlefield for Kalshi in the prediction market. The boundary between the prediction market and the traditional crypto derivatives market is completely blurred. Kalshi can use compliant event settlement logic to leverage the perpetual capital pool that originally belonged to the centralized exchange. For Coinbase, the trading volume and revenue of its perpetual contracts may be concretely reflected in its next financial report.

U.S. traders previously relied mainly on offshore platforms and faced custody risks, regulatory uncertainty and institutional access barriers. The release of this regulatory policy to support crypto-collateral will attract the participation of traditional institutions such as hedge funds and family offices. Traders can hold leveraged positions for a long time to hedge spot goods without frequent operations; at the same time, it attracts some offshore flows to flow back to US compliance channels.

At the same time, the approval of Kalshi and Coinbase will stimulate the accelerated launch of other products such as ETH perpetual, forming a more complete matrix of crypto derivatives. In the long term, this policy may enhance the competitiveness of the United States in the global crypto derivatives ecosystem, attract more capital, talent and infrastructure, and create favorable conditions for the deep integration of crypto assets and traditional finance.

At present, it may be the most regulatory-friendly era for the encryption industry.