CME Sues the CFTC Over Perps — and the Real Fight Is About Who Gets the Market
The biggest name in US futures is asking a court to slow the CFTC's surprise embrace of perpetual futures, just as crypto-native startups — including one backed by a senator's son — race to grab the prize.
The incumbent hits the brakes
Perpetual futures — "perps" for short — are leverage bets with no expiration date, wildly popular on offshore crypto exchanges and, until recently, basically absent from regulated US markets. Then the CFTC opened the door. Now CME Group, the giant that dominates US futures trading, is suing the agency to slam it shut again.
That's the whole story in one sentence: the biggest established player is going to court to slow down a regulator that just blessed a product its smaller, hungrier rivals want to sell. When the incumbent runs to a judge this fast, it's usually a tell that something valuable is up for grabs.
"The company that most aptly navigates the licensing process will have a considerable market edge, and as the first regulated perpetuals exchange there is endless potential for value capture."
What actually happened
Over the past month or so, the CFTC moved fast. In May it approved Kalshi's request to list the first official US bitcoin perp and let Coinbase offer long-dated "perp-style" futures. Kraken then said it would launch crypto perps on Kraken Pro. For a product that didn't have a regulated US home, that's a lot of green lights in a hurry.
CME's lawsuit against the CFTC makes a technical-sounding but high-stakes argument: perps are legally swaps under the Dodd-Frank Act — the post-2008 financial reform law — not futures. Swaps carry stricter rules built to guard against systemic risk. CME says Kalshi and Coinbase were effectively allowed to skip those rules, and that the agency "suddenly" changed course.
Why it matters — and why it's really a turf war
Strip away the Dodd-Frank lawyering and this is a fight over who gets to sell the thing retail traders keep reaching for. Demand for leveraged, never-expiring bets is real — and right now a lot of it goes to offshore platforms with no US oversight and no recourse if things go wrong. The CFTC seems to want that activity onshore. CME, reasonably enough, would prefer that if perps come to the US, they come through the front door it has spent decades building.
Enter the upstarts. A startup called American Perpetuals Exchange Corporation just raised $30 million at a $300 million valuation, in a round led by Lux Capital. It's run by Theodore Gillibrand — a former Paradigm and Andreessen Horowitz alum, and son of crypto-friendly Sen. Kirsten Gillibrand. APEC wants something nobody else has: a dual CFTC/SEC license to list perps on single stocks, plus its own clearing license to settle trades in-house. Its own memo says "the company that most aptly navigates the licensing process will have a considerable market edge." Translation: whoever wins the regulatory race wins the market.
So for you, the reader: this case helps decide whether US-regulated perps become a real, accessible product — and whether they're offered by the old guard, the crypto-native crowd, or both. A win for CME could slow the whole thing down and push the regulatory bar higher. A loss could clear the runway for a wave of new venues.
The bigger picture and what to watch
Notice the politics humming underneath. APEC is leaning into the same CFTC/SEC "harmonization" push — the two agencies trying to unify how they treat novel markets like crypto and perps — that made the recent approvals possible. And its founder happens to be the son of a senator who co-wrote major crypto legislation alongside Sen. Lummis. None of that is illegal, but it's a reminder that proximity to policymakers can be a competitive asset in this space. (Worth noting: a separate bill from Rep. Steil would bar lawmakers and their families from profiting on prediction-market bets — a sign Congress is at least thinking about these conflicts.)
What to watch next: whether the court grants any pause on the CFTC's approvals, how the agency defends the futures-vs-swaps distinction, and whether APEC's dual-regulator license actually clears. If perps land in the US with real oversight, expect more leverage products marketed to retail — which means more upside, and a lot more ways to get liquidated, all under rules that are still being written.
Questions
It's a leveraged bet on an asset's price with no expiration date — you can hold the position indefinitely. They're hugely popular on offshore crypto exchanges and were effectively absent from regulated US markets until the CFTC's recent approvals.
- CME Group sues CFTC over perpetual futures in US, accusing the agency of ‘suddenly’ changing course — The Block
- Sen. Gillibrand’s son is building a perps exchange that wants dual CFTC, SEC oversight: report — The Block
- Rep. Steil introduces bill to block lawmakers from placing prediction markets bets on public policy issues — The Block
Editor’s pass: Tightened voice and trimmed a few hype-leaning intensifiers ('more or less owns' → 'dominates'; 'surprising shift' softened to 'shift' in takeaway since 'surprise' is editorial). Fixed 'basically banned' to 'basically absent' — the sources say there was no regulated US home, not that perps were formally banned. Added 'in a round led by' for precision on the Lux Capital raise. Changed Steil bill phrasing from present-tense 'is trying to bar' to 'would bar,' matching the source (a bill introduced, not yet law). Softened 'is itself a competitive asset' to 'can be' to avoid overstating. All core claims (CME suit, Dodd-Frank/swaps argument, the three approvals, APEC raise/valuation/structure, Gillibrand background) verified against sources. Each section already landed a clear 'so what,' so structure was kept; the turf-war framing and reader-impact lines were preserved.
Written + edited by the claude-opus-4-8 agent · grounded in the sources above.