CFTC Advances Framework For Perpetual Contracts And 24/7 Markets

Key Developments

The Commodity Futures Trading Commission (CFTC or Commission) recently undertook a series of coordinated actions—including a Commission order, policy statement, staff interpretation and staff advisory—addressing perpetual derivatives and 24/7 trading.

• The Commission approved the first perpetual bitcoin futures contract for listing on a U.S. designated contract market.
• CFTC staff issued an interpretation permitting certain offshore perpetuals to be treated as “foreign futures.”
• The CFTC released a policy statement emphasizing case-by-case review for listing of other perpetual contracts.
• CFTC staff issued an advisory outlining expectations for stakeholders participating in continuous 24/7 markets.
• Collectively, these actions are a significant step toward establishing a regulatory pathway for crypto-based perpetual contracts in the U.S.

Background: Perpetual Contracts

Perpetual contracts are derivative instruments that have no fixed expiration date and rely on a funding rate mechanism to maintain price alignment with the underlying spot asset. A funding rate is a periodic payment between the long and short sides of the contract, the direction and magnitude of which is determined by the difference between the perpetual contract’s market price and the underlying asset’s spot price. When a perpetual contract trades above the spot price, traders with long positions make payments to traders with short positions, and vice versa. These payments create an economic incentive for market participants to arbitrage any price differences between the derivative and the spot asset.

Perpetual contracts are among the most heavily traded crypto derivatives globally. Historically, however, they have been offered primarily on offshore venues, in part due to regulatory uncertainty in the United States. The CFTC’s recent actions reflect an effort to bring these products into the U.S., while clarifying their regulatory classification and associated compliance expectations.

Commission Order Approving Bitcoin Perpetual Contract

In a May 29, 2026 order, the CFTC approved a request to list a perpetual bitcoin contract as a futures contract on a designated contract market. The contract is a cash-settled derivative referencing a real-time bitcoin price index, trades continuously on a 24/7 basis and uses a periodic funding rate mechanism to maintain alignment between the contract price and the underlying spot price.

The Commission’s analysis emphasized that the contract exhibits many of the defining characteristics of a futures contract, including standardization, centralized clearing and the ability to offset positions. Although the contract has no fixed expiration date, the Commission noted that courts and prior precedent have recognized that futures contracts may have indefinite duration and that a fixed maturity is not a necessary element of a futures contract.

The Commission also made clear that its analysis was limited to perpetual contracts referencing digital commodities such as bitcoin, in which the underlying spot market is deep, active and continuously traded. The order does not extend to perpetual contracts referencing other asset classes, such as agricultural products, precious metals, equity securities and narrow-based security indexes.

Staff Interpretation Regarding Offshore Perpetual Contracts

Also on May 29, the CFTC’s Market Participants Division issued an interpretive letter regarding offshore perpetual contracts. In the letter, staff confirmed that certain perpetual contracts may be categorized as “foreign futures” under Commission Regulation 30.1 when traded on a foreign board of trade. This conclusion was based on the presence of core futures-like characteristics, including standardization, central clearing, margining tied to price movements, the ability to offset positions and the transfer of price risk without transfer of the underlying asset.

Part 30 and Part 48 of the CFTC’s regulations provide a comprehensive framework that allows certain “domestic customers” access to foreign futures and foreign exchanges. The interpretive statement may expand U.S. customers’ ability to access offshore perpetual futures, provided the conditions of Part 30 and Part 48, as applicable, are met. Consistent with the Commission’s order approving bitcoin perpetual contracts, the interpretation is limited to perpetual contracts referencing digital commodities that have deep, active and continuously observable spot markets. The staff made clear that the interpretation does not extend to perpetual contracts based on other asset classes.

Policy Statement on the Listing of Perpetual Contracts

The Commission also issued a policy statement expressing its broader views on the listing of perpetual contracts in U.S. derivatives markets. The policy statement explains that perpetual contracts are structurally distinct from traditional futures contracts because they lack a fixed expiration date and instead rely on a funding rate mechanism to maintain price convergence with the underlying asset. These features raise novel issues relating to market structure, customer protection and resilience during periods of market stress because the relevant reference price must remain reliable on a continuous basis rather than at a single point in time.

Due to these considerations, the Commission stated that perpetual contracts referencing asset classes not addressed in the bitcoin order should be submitted for Commission review and approval under Regulation 40.3, rather than submitted for self-certification under Regulation 40.2. According to the Commission, Regulation 40.3’s product approval process better serves the public interest and provides a more appropriate framework for evaluating these products, given their novel characteristics and the complexity of the issues they present.

The policy statement is non-binding and does not impose new legal obligations, but it reflects the Commission’s expectation that market participants will engage with the agency when developing new perpetual products. The Commission also noted that it may address perpetual contracts more broadly through future guidance or rulemaking.

Staff Advisory on 24/7 Trading and Clearing

Finally, CFTC staff issued an advisory setting forth supervisory expectations for derivatives markets that seek to offer trading and clearing on a continuous, 24 hours-a-day, 7 days-a-week basis. The advisory reflects increasing interest in continuous trading driven by technological developments and market demand, particularly in digital asset markets.

The advisory does not create new legal obligations and is intended to be informational, but it outlines key areas of focus for registered entities. For trading venues such as designated contract markets and swap execution facilities, the advisory emphasizes the need for robust real-time monitoring, surveillance and risk controls to address potential manipulation, disruptions and operational risks in a continuous trading environment.

For derivatives clearing organizations, the advisory highlights the importance of appropriately calibrating margin requirements, managing liquidity and financial resources, and addressing the risks associated with weekend trading and potential divergence between trading and clearing cycles. For intermediaries such as futures commission merchants, the advisory underscores the need to maintain customer fund segregation, enhance risk management processes, provide appropriate customer disclosures and ensure sufficient operational staffing and infrastructure.

What This Means for Market Participants

Taken together, the CFTC’s recent actions represent a meaningful shift in how the regulator approaches perpetual contracts and related market structure issues. Most immediately, the approval of a bitcoin perpetual futures contract signals that U.S. markets for these products are beginning to open. For years, perpetual trading activity has been concentrated in offshore venues due to regulatory uncertainty. The Commission’s order—and the broader framework released alongside it—marks a significant step toward bringing this highly liquid segment of the crypto derivatives market into the U.S.

This shift is also likely to accelerate momentum toward additional product development and listing activity. The CFTC’s coordinated actions provide a pathway for market participants seeking to offer perpetual products, including through both U.S. exchanges and offshore platforms accessed through regulated intermediaries. Public reporting already indicates that additional perpetual contract listings, including those involving other digital assets, are under active consideration.

At the same time, the Commission’s approach underscores that product classification will be a critical threshold issue. The emerging view that certain perpetual contracts may be treated as futures—or, in the offshore context, as foreign futures—rather than swaps has significant regulatory implications. Most notably, classification as a futures contract avoids the application of the swap regulatory framework, including swap dealer registration requirements. For market participants structuring new products or facilitating access to offshore venues, this classification analysis will be central to determining the applicable regulatory obligations and compliance architecture.

Importantly, however, the Commission expressly limited the scope of its recent actions. The approval order and staff interpretation are narrowly focused on perpetual contracts referencing digital commodities, where the underlying spot markets are deep, active and continuously traded. The CFTC has made clear that this reasoning may not extend to other asset classes. As a result, market participants should not assume that similar treatment will be available for perpetual contracts based on other underlying asset classes.

The Commission also emphasized the importance of proactive engagement with CFTC staff. The policy statement makes clear that market participants seeking to list perpetual contracts on other asset classes should expect to submit those products for review and approval under Regulation 40.3. This signals a preference for iterative engagement with the Commission—rather than reliance on self-certification—for novel products and suggests that early dialogue with regulators will be critical to navigating the approval process for perpetual contracts.

The CFTC’s simultaneous issuance of a 24/7 trading advisory further highlights that operational infrastructure and risk management capabilities will be subject to heightened scrutiny in 24/7 markets. The shift toward continuous trading and clearing environments—particularly in digital asset markets—introduces new challenges relating to liquidity, volatility, margining and system resilience. The advisory underscores that trading venues, clearinghouses and intermediaries will need to demonstrate robust real-time surveillance, risk controls, margin frameworks and operational support to operate in a 24/7 environment.

Finally, these developments should be understood in light of broader policy signals from CFTC leadership. In a contemporaneous op-ed, Chairman Selig characterized the approval of a bitcoin perpetual contract as a “historic” step that “chart[s] a path for one of the most liquid segments of the crypto asset markets to exist within the U.S. regulatory framework.” He emphasized that, until now, the absence of regulatory clarity had pushed perpetual trading activity offshore, fragmenting liquidity and limiting access for U.S. market participants. The Commission’s current approach is intended to reverse that dynamic by providing a workable framework that promotes responsible innovation while maintaining safeguards against excessive risk.