Coinbase, Kalshi and Payward backs CFTC in lawsuit over single-stock perp futures
A group of major crypto firms is seeking federal court permission to file an amicus brief defending the CFTC's authority to regulate single-stock perpetual futures in the U.S.Coinbase, Kalshi, Kraken parent Payward, DRW Holdings, Jump Trading, and Paradigm have moved for leave to file the brief to support the Commodity Futures Trading Commission, according to a Monday court filing.The brief comes in response to a lawsuit filed last week by the Capital Markets Alliance (CMA) seeking to overturn the CFTC's approval of the products. The CMA is an industry association with members including Cboe and Citadel Securities.According to the Monday filing, Coinbase, Kalshi, and Payward have submitted applications with the CFTC to list equity perps tied to U.S. stocks, and the applications were deemed approved on Nov. 2.Perpetual futures, also known as perps, are derivatives that allow traders to speculate on an asset's price movements without holding the underlying asset. Unlike traditional futures contracts, they have no expiration date.Dispute over regulatory authorityIn CMA's view, equity perps do not expire on a set date, so they should not be treated as futures but rather as "security-based swaps" that can't be listed on CFTC-regulated exchanges. The association claimed that the CFTC overstepped the Securities and Exchange Commission's authority.The crypto firms, however, pushed back against that argument, saying the SEC was "at the table from the very start" of the regulatory process."The agencies jointly sought public comment on whether perpetual contracts should be classified as security futures," the Monday filing said.Molly Abraham, general counsel of Coinbase, wrote on X that under the Commodity Exchange Act and the securities futures framework Congress established in 2000, security futures products are not swaps. Separately, Coinbase Vice Chairman Ryan VanGrack added that global markets are already trading equity perps."U.S. investors deserve access to these markets under the strong consumer protections and joint oversight of the CFTC and SEC," VanGrack said. "The U.S. should lead, not cede, this space."