CFTC says CME lacks standing to block crypto perpetual futures

Federal regulators want CME Group's crypto lawsuit thrown out. The US Commodity Futures Trading Commission told a court on October 16 that the exchange has no standing to block rivals from listing perpetual futures.

The brief landed in the US District Court for the District of Columbia and was first reported by CoinDesk. It answers CME's opposition in a case the exchange filed in June.

What CME is fighting over

CME Group runs the largest futures market in the United States. In June it sued the CFTC, the agency that oversees US derivatives, over one decision. On May 29, the CFTC approved a bitcoin perpetual futures contract from Kalshi, a smaller exchange, and said it would treat such contracts as futures. The agency said it would weigh each perpetual contract on its own facts, rather than write a broad new rule. Kalshi, better known for event contracts, was first through that door as a registered US exchange.

That decision matters because of what a perpetual future is. A standard futures contract expires on a set date. A perpetual does not. It never expires. Funding payments between buyers and sellers keep its price near the spot market. Perps trade heavily on offshore exchanges, and they are a common way to bet against bitcoin. Before the Kalshi approval, no cleared US route existed.

CME, which recently added Uniswap and Bitcoin Cash futures, says the CFTC got the law wrong. In its complaint, the exchange argues perpetual contracts are swaps, not futures, under the Commodity Exchange Act and the Dodd-Frank Act. Swaps follow a different approval path. By clearing Kalshi's product as a future, CME says, the regulator skipped steps and let new entrants chase its retail customers. One product, two labels. That split is the heart of the case.

The CFTC's answer: no standing, no injury

The regulator's reply is blunt. It says CME cannot show real harm, so it cannot sue. CME is free to list the very same perpetual futures itself, the CFTC argues, and has simply chosen not to.

Regulators also point to CME's own words. The exchange has told investors it sees little demand for perps, and that they are not substitutes for its own futures. CME's monthly bitcoin and ether futures volume ran higher in June and August than in May, when the order came out. "CME cannot have it one way with the court and another way with the investing public on earnings calls," the brief said. It also faulted "allegations of increased competition, without any plausible inference of an imminent financial injury."

In September the CFTC called the suit "much ado about nothing." It said any injury was "entirely self-inflicted and based on CME's refusal to list perpetual futures for trading." The October filing sharpens that line and asks the judge to dismiss the case outright.

Why this fight matters

For now, nothing changes for traders. US investors who want perpetual futures still mostly use offshore platforms. The stakes are practical. Funding payments can run positive or negative, so the running cost of holding a perp shifts with demand, and most US retail traders cannot legally use the large offshore venues where these contracts trade. That is part of why a cleared domestic version drew attention. A win for CME could force the CFTC to reopen how it cleared Kalshi's contract. A win for the CFTC would leave the door open for more US venues to list perps as futures, under rules US traders can see.

What to watch

No ruling has come yet. The CFTC has asked for an oral hearing, so both sides could argue in person.

One outside group has already weighed in. The Hyperliquid Policy Center, tied to a large perpetual futures venue, filed a brief backing dismissal. Its point: a competitor usually needs government action that directly and clearly hurts its business to have standing, and CME has not shown that.

Analysts are watching the clock. "What increasingly concerns us is the growth in perps while the litigation is playing out," said Jaret Seiberg, a policy analyst at TD Cowen, in a client note. CME did not respond to CoinDesk's request for comment, and the presiding judge, Colleen Kollar-Kotelly, has set no date to rule.