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The United States is preparing to allow domestic crypto-perpetual futures trading as it grapples with broader rules for crypto markets. The move shows that the Commodity Futures Trading Commission (CFTC) is no longer waiting for lawmakers to bring the larger crypto legislation back from the dust before taking any action.
The agency is focused on implementing “true perpetual futures” for cryptocurrencies in the United States, CFTC Chairman Michael Selig said, addressing the Milken Institute’s Conference on the Future of Finance.
These contracts enable traders to place bets on the future price of crypto assets without an expiration date. Unlike conventional futures contracts, which expire on a scheduled date, perpetual futures can be held indefinitely provided traders have sufficient margin (or collateral) to maintain them.
The U.S. has lost significant trade activity to platforms based in Asia, Europe, and the Bahamas, Selig said. Several of these offshore exchanges already offer perpetual futures and have grown into among the most traded crypto products on the planet.
Selig said from Washington that the United States needed that liquidity at home and that proper investor protections were necessary to prevent firms from collapsing and causing damage domestically.
He said his hope is for the CFTC to offer a workable framework for perpetual futures “in the next month or so.” Though several long-dated crypto futures products are traded in the U.S., they are not structured as true perpetual contracts.
To make perpetual futures widely accessible–particularly to retail traders–the CFTC would be required to change some of its rules.
Retail demand drives growth as regulators weigh risks
Because they do not require ownership of the underlying cryptocurrency, perpetual futures have been especially suitable for retail investors and allow speculation on price changes.
Traders may use leverage and borrow money to expand the size of their bets. At the same time, this expands profits but also magnifies losses. As long as the traders maintain the required margin, a position will remain open indefinitely.
Such flexibility has given perpetual futures importance to global crypto trading volumes. But those products are also often associated with sharp price movements in crypto markets.
Large positions are quickly liquidated when prices move suddenly due to heavy leverage. This could lead to cascading selling, creating a forced-selling effect, and fueling market turmoil. Proponents of perpetual futures maintain that they have legitimate uses, such as price discovery and risk management.
However, critics raise alarms about the risks to less experienced investors.
The CFTC’s push comes as Congress continues to debate broader digital asset legislation. Under President Donald Trump’s second administration, crypto regulation has become a policy priority. In July, Trump signed the first federal regulatory framework for stablecoin issuers into law, marking a milestone for the industry.
Still, a larger market structure bill — which would clarify how different types of crypto assets are regulated — remains under discussion in the U.S. Senate. Progress has slowed as the crypto industry and banking lobby disagree over certain provisions, including how rewards tied to stablecoin balances should be treated.
The CFTC has also been collaborating with the U.S. Securities and Exchange Commission (SEC) through the joint Project Crypto.
Selig has long argued that failing to provide a clear path for perpetual futures in the U.S. was a mistake. Without earlier action, he said, markets had grown organically offshore, and if clear, workable rules are put in place now, it would help bring trading activity back under U.S. oversight.
The CFTC seems intent on continuing its march to the front lines, where it has clear authority, in derivatives markets, in the face of a legislature still actively negotiating more far-reaching crypto legislation.
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