Coinbase and Kalshi Back CFTC in Lawsuit on US Stock Perp Futures

Coinbase, Kraken’s parent Payward, and several other major market participants have asked a federal court to accept an amicus brief supporting the US Commodity Futures Trading Commission (CFTC) in a legal fight over “stock perpetual” futures—contracts that track individual US stocks and do not have a fixed expiration date.

The filing, submitted Monday, arrives days after a federal judge said the CFTC likely exceeded its statutory authority when it allowed single-stock perpetuals to trade under a regulatory framework the plaintiff argues is reserved for security futures.

Key takeaways

• Six firms asked the court to accept an amicus brief backing the CFTC in the lawsuit over whether stock perpetual futures fit existing futures law.
• Judge Valerie Caproni questioned the CFTC’s legal interpretation, suggesting the contracts appear more like swaps than security futures.
• The case could decide how exchanges can offer “non-expiring” stock-linked derivatives to retail traders in the US.
• Trading was not halted for now, because the judge denied a request for a temporary restraining order.

Amicus brief seeks clarity on the legal category of stock perps

In the amicus brief proposed on Monday, Coinbase’s legal representative Molly Abraham said the group backing the CFTC also includes Payward (Kraken’s parent), DRW Holdings, Jump Trading, and Paradigm Operations. The companies argue that stock perpetual futures fall within existing US futures laws.

The question at the center of the dispute is not whether stock perps exist, but under which regulatory authority they should be governed. The CFTC has maintained a path for these instruments to trade on regulated venues, while challengers argue the contracts should instead be treated as security-based swaps—an area typically associated with Securities and Exchange Commission (SEC) oversight.

How “stock perps” differ from traditional futures

Stock perpetuals allow traders to take positions tied to the price movements of individual publicly traded shares without buying or holding the underlying stock. Unlike conventional futures contracts, stock perps do not have a fixed expiration date.

That feature is central to the lawsuit. The Capital Markets Alliance Association (CMAA), a newly formed industry group representing traditional market participants, argues that because the contracts lack a set end date, they should be regulated as security-based swaps. CMAA’s position is that security-based swaps face more restrictive rules—particularly around access for retail participants—compared with the regulatory treatment of security futures.

Companies supporting the CFTC counter that a fixed expiration date is not necessary for a contract to qualify as a security future. Under their view, the contracts should fall under the category that brings them under joint CFTC/SEC regulatory oversight, rather than SEC-led swap regulation.

Earlier coverage from Cointelegraph noted that the CFTC had announced that single-stock perpetual futures could begin trading on US-regulated exchanges for the first time. That announcement is part of the timeline leading to the current court fight.

Judge Caproni signals skepticism but leaves approvals in place

The dispute reached a key courtroom moment after CMAA sued the CFTC. According to court documents shared on CourtListener, US District Judge Valerie Caproni said the plaintiff was likely to succeed in its claim that the CFTC “exceeded its statutory authority” by allowing stock perps to trade as security futures.

In her assessment, Caproni found the contracts appeared to fit the characteristics of swaps rather than security futures. That finding directly challenges the CFTC’s interpretation of what the law allows.

At the same time, Caproni did not stop the CFTC’s approvals. She denied CMAA’s request for a temporary restraining order, concluding that CMAA failed to show imminent and irreparable harm.

As a result, the regulatory green light for trading remains in place while the lawsuit continues. CMAA is scheduled to file its reply to the CFTC’s opposition to a preliminary injunction on Tuesday, keeping momentum on whether the court will move beyond skeptical analysis toward a binding ruling.

Why the dispute matters for retail access and exchange offerings

Beyond the legal arguments about contract design, the case has a practical industry impact: it could determine how—and whether—US exchanges can offer perpetual, stock-tracking derivatives to retail customers.

If the court agrees with CMAA that these instruments resemble security-based swaps, exchanges may need to adjust product structures or regulatory compliance pathways, potentially changing who can trade them and under what conditions. If the court instead upholds the CFTC’s approach, it would reinforce the regulator’s authority to treat non-expiring stock derivatives within futures frameworks.

The standoff also illustrates a broader regulatory tension in the derivatives space: how agencies categorize products that combine familiar underlying references (individual stocks) with modern contract mechanics (perpetual exposure). The outcome may influence not only stock perps, but also how future derivative contracts with similar structural features are analyzed.

For traders and market participants, the next signal to watch is the court’s consideration of CMAA’s request for a preliminary injunction and whether the judge’s view of the contracts as “more like swaps” ultimately translates into a change to trading approvals.