CME Sues CFTC Over Perpetual Futures Approval

CME Group is set to sue the Commodity Futures Trading Commission (CFTC) over its approval of perpetual futures, according to CEO Terry Duffy. The exchange operator will file the lawsuit on Thursday, with Duffy stating that he 'is always up for a good battle' and has never shied away from one.

The CME Group chief has been critical of perpetual futures, which are listed derivatives without an expiration date, allowing traders to maintain positions indefinitely without the need to roll over contracts. This, combined with high degrees of leverage often as much as 50-to-1, poses a significant threat to retail investors who may not fully grasp the corrosive effects of funding rate costs on their positions.

The CFTC gave its approval for perpetual futures last month, marking the first time such instruments will be available to U.S. investors through domestic, regulated exchanges. Cryptocurrency exchange Coinbase and prediction market platform Kalshi are planning to launch perpetual crypto futures as a result.