Most futures contracts come with a deadline. A trader agrees today on a price for a stock, a barrel of oil or a bushel of wheat, and the deal settles on a set date weeks or months later. As o
Most futures contracts come with a deadline. A trader agrees today on a price for a stock, a barrel of oil or a bushel of wheat, and the deal settles on a set date weeks or months later.
As of Tuesday, Nov. 3, U.S. stock traders have a version with no deadline at all.
The Commodity Futures Trading Commission, the federal agency that oversees futures markets, said perpetual futures tied to individual stocks can now trade on CFTC-registered exchanges.
It's the first time these contracts can trade on CFTC-registered exchanges.
Perpetual futures, or "perps," are bets on whether a crypto price will go up or down, without ever owning the coin. Unlike regular futures, they have no expiry date, so a trader can hold the bet as long as they like.
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Stocks fall under the Securities and Exchange Commission, while futures fall under the CFTC. That split has long left products that mix the two in limbo.
CFTC Chairman Michael S. Selig said these products had been stranded in what SEC Chairman Paul S. Atkins called a regulatory "no man's land" because the two agencies' rules didn't line up.
The new contracts, which the CFTC calls "Equity Perps," get past that problem by sitting under both agencies.
They were "deemed approved by the Commission" as security futures products, Selig said in a statement. That means both the CFTC's and the SEC's rules apply.
However, only certain venues qualify.
The exchange must be registered with the CFTC as a futures market and also registered with the SEC to trade security futures.
The move follows a smaller step earlier this year.
In May, the CFTC approved a Bitcoin perpetual futures contract from Kalshi, a federally regulated exchange best known for prediction markets.
Selig framed both decisions as a way to keep American traders from looking abroad.
Without U.S. options, he said, they would be "forced to turn to offshore, and often unregulated, venues."
He called perpetual contracts "widely sought tools for risk-management and price-discovery," meaning they help traders protect against losses and help markets settle on a fair price.
The CFTC did not say which exchanges will list the contracts first, which stocks they will cover, or when trading will begin on any specific platform.
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