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SEC backs CFTC in court fight over single-stock perpetual futures
Washington’s two market regulators usually argue over turf. This time, one is defending the other in court.
The SEC has filed an amicus brief supporting the Commodity Futures Trading Commission, which is being sued over its approval of single-stock perpetual futures. The lawsuit comes from the Capital Markets Alliance Association, an industry group whose members include Cboe and Citadel Securities.
The stakes go beyond one product. The case asks which agency gets to police a new kind of derivative tied to individual stocks. It also decides whether crypto-native venues like Coinbase Derivatives and Kalshi can list it.
What the lawsuit is actually about
Start with the product. A traditional futures contract is a bet with a deadline: it expires on a set date, and the trade settles. A perpetual future drops the deadline entirely, so a position can stay open indefinitely.
The CFTC approved single-stock versions of these contracts after a 45-day review under its Regulation 40.3. It classified them as security futures under the Commodity Futures Modernization Act of 2000. That label allows them to trade on exchanges that meet the relevant requirements.
The Capital Markets Alliance Association disagrees with that label. Its suit, filed Nov 3, 2026, names the CFTC and its chairman, Michael S. Selig. The group argues the contracts are really security-based swaps, which would place them under SEC jurisdiction.
The reasoning hinges on delivery. A futures contract traditionally obligates delivery at some future point. The plaintiffs argue that a contract with no expiration never creates that obligation. If nothing is ever due, they contend, calling it a future stretches the definition past its breaking point.
#Write2Earn #SEC #BTC #ETH $BTC $ETH
SEC backs CFTC in court fight over single-stock perpetual futures
Washington’s two market regulators usually argue over turf. This time, one is defending the other in court.
The SEC has filed an amicus brief supporting the Commodity Futures Trading Commission, which is being sued over its approval of single-stock perpetual futures. The lawsuit comes from the Capital Markets Alliance Association, an industry group whose members include Cboe and Citadel Securities.
The stakes go beyond one product. The case asks which agency gets to police a new kind of derivative tied to individual stocks. It also decides whether crypto-native venues like Coinbase Derivatives and Kalshi can list it.
What the lawsuit is actually about
Start with the product. A traditional futures contract is a bet with a deadline: it expires on a set date, and the trade settles. A perpetual future drops the deadline entirely, so a position can stay open indefinitely.
The CFTC approved single-stock versions of these contracts after a 45-day review under its Regulation 40.3. It classified them as security futures under the Commodity Futures Modernization Act of 2000. That label allows them to trade on exchanges that meet the relevant requirements.
The Capital Markets Alliance Association disagrees with that label. Its suit, filed Nov 3, 2026, names the CFTC and its chairman, Michael S. Selig. The group argues the contracts are really security-based swaps, which would place them under SEC jurisdiction.
The reasoning hinges on delivery. A futures contract traditionally obligates delivery at some future point. The plaintiffs argue that a contract with no expiration never creates that obligation. If nothing is ever due, they contend, calling it a future stretches the definition past its breaking point.
#Write2Earn #SEC #BTC #ETH $BTC $ETH
