- A crypto product is coming to US stocks. The Commodity Futures Trading Commission cleared the way for perpetual futures tied to individual stocks to trade on registered US exchanges for the first time. CFTC Chairman Michael Selig said Tuesday the contracts, known as equity perps, were deemed approved under existing security futures rules and will be overseen by both the CFTC and the SEC.
- The market being brought onshore is huge. Perpetual futures let traders bet on an asset’s price without owning it, have no expiration date and often use leverage. Perps recorded more than $630 billion in trading volume over the past month, according to DeFiLlama data, with decentralized venues such as Hyperliquid among the biggest.
- Wall Street is already positioning. Intercontinental Exchange, the New York Stock Exchange’s parent, recently invested in tradeXYZ, a builder of perpetual futures markets on Hyperliquid. Earlier this year the CFTC approved the first bitcoin perpetual futures contract on a regulated US exchange, and President Trump said in August that the agency is working to bring Hyperliquid into the US under federal rules.
- Not everyone welcomes leveraged products. On the same day, Pershing Square’s Bill Ackman told CNBC that the rise of perpetual futures and one-day leveraged vehicles is dangerous for investors treating the stock market as a get-rich-quick scheme.
What Happened?
Selig said bringing these “innovative products into our regulated markets ensures that American investors and traders can access these products within the protections of the CFTC’s proven regulatory framework, rather than being forced to turn to offshore, and often unregulated, venues.” Equity perps had faced hurdles because stock-based derivatives fall under both securities and commodities laws. The new contracts rely on a framework set up by the Commodity Futures Modernization Act of 2000, which provides for joint SEC and CFTC oversight, and the two agencies also agreed to coordinate more closely on products that cross their jurisdictions.
Why It Matters?
The decision extends the Trump administration’s push to bring perps markets under US oversight, after the bitcoin perps approval earlier this year. It could pull trading volume from offshore crypto venues onto US exchanges and blur the line between crypto trading platforms and traditional stock markets. For exchange operators such as ICE, which has already invested in onchain perps through tradeXYZ, it opens a potential new product line, though the use of leverage will draw scrutiny from critics like Ackman.
What’s Next?
Selig’s statement did not name the exchanges that will offer equity perps or the stocks that will be available at launch, so those details are the next thing to watch. Investors will also look for how the SEC and CFTC split day-to-day oversight under their new coordination agreement. Any move to bring Hyperliquid itself into the US framework, which Trump has said the CFTC is working on, would be the next major step.
