Coinbase, Kalshi, and Kraken parent Payward backed the U.S. Commodity Futures Trading Commission (CFTC) in a lawsuit over perpetual futures tied to individual stocks.
DRW Holdings, Jump Trading, and Paradigm filed a letter supporting the CFTC. The case is before the Southern District of New York.
Important Read: Bitcoin faces CPI showdown as ETFs shed $201 million
The Capital Markets Alliance (CMA), whose members include Cboe and Citadel Securities, sought to challenge approvals deemed effective November 2 for Coinbase Derivatives, KalshiEX, and Payward-owned Bitnomial.
Perpetual futures, also known as perps, are derivatives that allow traders to take positions on stock prices without owning the shares. They have no fixed expiration date.
CMA argues that this structure places the instruments under SEC authority as security-based swaps. In contrast, the companies argue they fall within the joint CFTC-SEC framework as security futures.
The companies cite the Commodity Futures Modernization Act of 2000, which established joint regulation of security futures products.
The CFTC said eligible exchanges should also register with the SEC, emphasizing that its regulatory framework incorporates securities oversight.
Sign up on WEEX and roll for a chance to win a share of the $1,000,000 prize pool.
