The Chicago Mercantile Exchange (CME) has filed a lawsuit against the U.S. Commodity Futures Trading Commission (CFTC), challenging the agency's approval of Bitcoin perpetual futures (perps) on platforms like Kalshi and Coinbase. The legal dispute, which began on Thursday, could have far-reaching implications for Bitcoin leverage trading in regulated markets.
Investment bank TD Cowen believes CME has the stronger legal case. Jaret Seiberg, managing director at TD Cowen’s Washington Research Group, noted in a note that the crux of the case hinges on whether a product that never expires can legally qualify as a futures contract. CME argues that under the Commodity Exchange Act, a futures contract must involve delivery at a set future date; because perpetuals have no expiration, they should be regulated as swaps. Swaps carry different rules—dealers face registration and five-day margin requirements, while futures benefit from one-day margins and tax advantages.
Seiberg also highlighted procedural weaknesses in the CFTC’s approval. The agency had previously treated perpetual contracts as swaps and even sought public comment in April 2025, but then approved Kalshi’s Bitcoin perpetual futures in a single day without issuing a regulation. CME contends this violates the Administrative Procedure Act by lacking independent decision-making and clear justification for classifying the product as a futures contract.
CME is asking the court to vacate the CFTC’s approval and declare that similar perpetual contracts be regulated as swaps. A preliminary injunction request is expected, which could temporarily block perps trading as the case proceeds. The CFTC has pushed back, accusing CME of “lawfare” against the pro-innovation agenda, while Kalshi says the suit is about fear of competition. Coinbase, which offers global perpetual products through an affiliate, supports the CFTC’s approach.
In a related move, the CFTC and SEC have jointly requested public feedback on updating derivatives rules, including the definitions of swaps and how newer products like perpetual futures should be treated. This signals that the lawsuit may catalyze broader regulatory clarification for crypto derivatives.
