CME Group, counterattack with surprise lawsuit... Will Kalshi and Coinbase perpetual futures be halted?

▲ Bitcoin (BTC), cryptocurrency regulation/AI generated image

CME Group (CME) has put the brakes on the approval of perpetual futures in the US. As a result, the key issue in the cryptocurrency derivatives market has shifted from innovation competition to a legal battle for definition.

According to crypto media outlet The Block on June 20 (local time), investment bank TD Cowen assessed that CME Group has stronger legal grounds in its lawsuit against the US Commodity Futures Trading Commission (CFTC). The issue is the CFTC's decision to approve cryptocurrency perpetual futures for Kalshi and Coinbase (COIN).

CME Group argues that, under the Commodity Exchange Act, a futures contract must involve delivery or an equivalent procedure at a specific future date. Its logic is that because perpetual futures have no expiration, they should be regulated as swaps, not futures. Jaret Seiberg, Managing Director of TD Cowen's Washington Research Group, stated, “We believe CME has the upper hand in the lawsuit.”

Seiberg analyzed that the core of this lawsuit depends on whether products without an expiration date can legally be considered futures contracts. Swaps and futures have different regulatory and tax systems. Swap dealers are subject to registration requirements and 5-day margin rules. Futures typically follow 1-day margin rules and also receive tax benefits not available to swaps.

Procedural issues were also pointed out as favorable to CME Group. The CFTC previously treated perpetual contracts as swaps and sought public comment on related matters in April 2025. However, Kalshi's Bitcoin (BTC) perpetual futures were approved in a single day without formal rulemaking. Seiberg raised the possibility that the CFTC did not exercise sufficient independent judgment and did not properly explain why it viewed the product as a future rather than a swap.

CME Group is asking the court to overturn the CFTC's approval and rule that similar perpetual contracts should be regulated as swaps. Seiberg expects CME Group to seek a preliminary injunction to prevent the launch of perpetual futures during the lawsuit. Future points of interest will be the court's schedule and its decision on the injunction.

The CFTC strongly rebutted CME Group's lawsuit. A CFTC spokesperson stated, “CME has chosen to wage a legal battle against the agency and the pro-innovation agenda of the Trump administration rather than compete in the market.” Kalshi also argued, “This is not a matter of law, but a matter of fear of competition.” Subsequently, the CFTC and the US Securities and Exchange Commission (SEC) launched a public comment period to streamline regulations for swaps, security-based swaps, prediction market event contracts, and perpetual futures.

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