Last week the Commodity Futures Trading Commission allowed perpetual futures on individual US stocks to take effect, after letting its 45 day review clock expire without objecting. CFTC Chair Michael Selig issued a statement defending the decision the same day. Within 24 hours the Capital Markets Alliance, representing Cboe, Citadel Securities and the Healthy Markets Association, sued in New York for a restraining order to block the contracts. The CFTC responded on Friday, turning Cboe’s own words into a centerpiece of its defense.
At the heart of the case is whether these perpetuals should be classified as security futures or swaps. In a May 2025 letter to the agency, Cboe wrote that a perpetual derivative is a futures contract when it has no expiry or a very long one and uses a funding mechanism to track the spot price. It added that the listing exchange should decide whether a product is a future or a swap, and could self certify on that basis. Eighteen months later, Cboe is a founding member of the Capital Markets Alliance, which told a New York court last week that a contract with no expiry cannot be a future.
The CFTC’s brief, filed Friday (below), presses the point with Cboe’s own product range. Cboe has designed bitcoin and ether “continuous futures” with expirations up to ten years and a daily funding payment to keep them aligned with spot, marketed as a perpetual style product in a regulated wrapper. The agency says treating a 2035 expiry as a future while denying the label to a true perpetual is inconsistent. The alliance’s answer will presumably be that a date is a date.
The brief also attacks the alliance itself. Its only identified officer is Adam Ford, a lawyer at Ford O’Brien Landy whose office at 275 Madison Avenue sits two floors below the alliance’s registered address. Its only recorded activities are a perpetuals comment letter on November 2 and the lawsuit on November 3. Cboe is based in Illinois, Citadel Securities in Florida and Healthy Markets in Washington, so without the alliance none of them could have brought the case in Manhattan. The CFTC describes the alliance as a “sham entity” created to hand pick a court. Location matters because federal precedent binds only within its own circuit, and the New York courts have the friendliest language (for the plaintiffs) on what a future is.
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