The Chicago Mercantile Exchange (CME) filed a lawsuit (attached) today against Commodity Futures Trading Commission (CFTC) Chairman Michael Selig and the agency itself, challenging the regulator’s decision last month to approve Kalshi’s Bitcoin perpetual contract as a futures product. CME argues the contract is a swap under the Commodity Exchange Act and that the CFTC’s overnight approval violated both the statute and principles of administrative law.
The complaint, filed in the U.S. District Court for the District of Columbia, takes aim at the CFTC’s 29 May order approving Kalshi’s BTCPERP contract and the accompanying policy statement that opened the door for any futures exchange to self-certify similar cryptocurrency perpetuals without prior CFTC approval.
CME’s central argument is that perpetual contracts fit the statutory definition of a swap hand in glove. They involve periodic funding payments between counterparties based on the value of a commodity, transfer price risk between the parties and convey no ownership interest in the underlying asset. Critically, they have no expiration date and no delivery obligation. That last point is where CME draws the sharpest line. A “contract of sale of a commodity for future delivery” requires future delivery by its own terms. A perpetual, by design, never delivers anything.
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