CME Sues the CFTC Over Approval of Bitcoin Perpetual Futures for Kalshi
The fight over who gets to sell perpetual futures to American traders has moved into a federal courtroom. CME Group, operator of the largest U.S. derivatives exchange, sued the Commodity Futures Trading Commission on Thursday, asking a judge to undo the agency’s recent decision to let prediction market Kalshi list a bitcoin perpetual futures contract.
The lawsuit pits the country’s dominant futures exchange against its own regulator, and against a wave of crypto-focused competitors that want to bring one of the industry’s most popular trading products onshore.
What CME is asking for
CME filed the complaint on June 18 in the U.S. District Court for the District of Columbia, naming both the CFTC and its chairman, Michael Selig, as defendants, according to Reuters. Kalshi and Coinbase are not defendants.
The suit targets two actions the agency took on May 29. The first was an order approving Kalshi’s BTCPERP contract. The second was a policy statement that opened the door for other futures exchanges to offer similar products. On the same day, the CFTC also said it would not object if Coinbase gave U.S. customers access to perpetual futures offered on its foreign platform.
CME’s central argument is that perpetual contracts are swaps, not futures. Under the Dodd-Frank reforms of 2010, swaps face a different set of rules from exchange-traded futures, and CME says the CFTC had previously accepted that perpetuals fall on the swaps side of that line. The complaint says the agency’s decision causes “textbook competitive injury” by letting Kalshi, Coinbase and others compete for CME’s retail customers, Reuters reported.
The exchange also attacks how the decision was made. According to Cointelegraph, the complaint argues that Selig acted without a full five-member commission and that, “with one stroke of his pen,” he overrode Congress’s definition of a swap. Selig, confirmed by the Senate in December 2025, is currently the agency’s only sitting commissioner.
What the CFTC approved
The CFTC’s own press release from May 29 describes BTCPERP as “a perpetual contract that references the spot price of bitcoin.” Kalshi submitted it on May 28 under the agency’s Regulation 40.3, and the commission found it complied with the Commodity Exchange Act and the core principles that apply to designated contract markets. The agency added that perpetual designs “may not be suitable for all asset classes” and encouraged firms to consult staff before submitting perpetual contracts on other assets.
Unlike standard futures, perpetual contracts have no expiry date. Traders can hold positions indefinitely, and a periodic funding payment between longs and shorts keeps the contract price close to the underlying asset. The structure has become the main way crypto traders use leverage on offshore exchanges.
Both sides dig in
The response from the regulator was blunt. A CFTC spokesperson called the lawsuit “frivolous,” and Reuters quoted the agency as saying: “Incumbents fear the future and having to compete on a level playing field.” Kalshi spokesperson Elisabeth Diana told Reuters, “This isn’t about the law, it’s about the fear of competition.”
The suit was not a surprise. CME chief executive Terrence Duffy said on June 17 that the company planned to sue, Cointelegraph reported. Earlier in the week, Selig told CNBC that perpetual futures “trade very similarly” to other contracts, and he has argued that the Commodity Exchange Act does not define the term “futures contract.”
Why it matters for crypto readers
Perpetual futures are the heart of crypto trading. Volume in the product grew 29% last year to $61.7 trillion, according to CryptoQuant data cited by Reuters. For most of the product’s history, U.S. retail traders have been shut out of the largest perpetual venues, which operate offshore.
The May 29 decisions were a major step toward changing that. If they stand, regulated U.S. platforms such as Kalshi and Coinbase can compete directly for leveraged crypto trading, and other exchanges can follow. Kraken has already launched perpetual futures for U.S. users through Bitnomial, a CFTC-regulated venue, Cointelegraph noted. That is a direct threat to CME, which earns significant revenue from its own bitcoin and ether futures and sells largely to institutional and active traders.
The case also raises a broader governance question for the crypto industry. Much of the current U.S. policy shift toward digital assets has come through agency actions taken by small or single-member commissions. If a court decides that the CFTC overstepped by approving a product without public comment or a full commission, the ruling could make future crypto-friendly decisions easier to challenge, regardless of their merits.
What comes next
The CFTC will have an opportunity to respond in court, and the agency has signaled it will fight. In the meantime, the May 29 approvals remain in effect unless a judge decides otherwise, so U.S. perpetual products can keep developing while the case proceeds. Markets noticed: Reuters reported that shares of CME and Intercontinental Exchange fell after the CFTC’s decision last month. How the court treats the swaps question could shape the U.S. crypto derivatives market for years.