CME to sue CFTC over perpetual futures, CEO Terrence Duffy says

• CME claims perpetual futures are actually swaps under Dodd-Frank and that CME holds exclusive licenses with benchmark providers, meaning such products should be listed through CME regardless of format
• The CFTC first approved Kalshi to offer perpetual futures for crypto in the U.S., marking the first domestic approval of the asset class already popular overseas
• Duffy stated CME has been working on this legal strategy with its board for eight months and is 'prepared to go through this' fight despite his planned retirement in March 2027

CME to Sue CFTC Over Perpetual Futures Approval

Key Development:

CME Group CEO Terrence Duffy announced on CNBC's "Fast Money" that the exchange operator will file a lawsuit against the Commodity Futures Trading Commission (CFTC) on Thursday, challenging the regulator's approval of perpetual futures contracts in the U.S.

Background:

The CFTC recently approved prediction market platform Kalshi to offer perpetual futures ("perps")—futures contracts with no expiration date that allow traders to speculate on prices without owning underlying assets. This marked the first time the asset class, already popular overseas, was permitted domestically. Kalshi has expanded offerings to include various cryptocurrencies.

Legal Basis:

Duffy argues that perpetual futures are actually swaps under the Dodd-Frank Act, not futures contracts. He emphasized that CME holds exclusive licenses with all benchmark providers, meaning "all of these would have to go through CME regardless." If classified as swaps, competitors would need to list products through CME's infrastructure.

Corporate Context:

• Duffy, set to retire in March 2027, has been working on this litigation plan with CME's board for eight months
• He stated he's "always up for a good battle" and is "not taking this lightly"

Regulatory Position:

CFTC Chair Michael Selig defended the approval earlier this week, stating "It's time to approve regulated futures contracts that have no expiration date" while ensuring proper U.S. regulation.

Market Implications:

The lawsuit could significantly impact the emerging U.S. perpetual futures market, potentially limiting competition and maintaining CME's dominant position in derivatives trading. The outcome may determine regulatory classification and market access for this popular trading instrument.