Cboe-Backed Group Sues CFTC Over US Single-Stock Perpetual Futures Approvals
The Capital Markets Alliance, backed by Cboe and Citadel Securities, filed suit in federal court challenging the CFTC's approval of perpetual derivatives tied to individual US stocks. The group seeks to block the contracts from trading while the case proceeds, arguing they fall under SEC jurisdiction.
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The Lawsuit and Its Core Claims
The Capital Markets Alliance filed a federal lawsuit Tuesday in the US District Court for the Southern District of New York, challenging the Commodity Futures Trading Commission's approval of perpetual derivatives tied to individual US stocks. The complaint seeks to overturn the approvals and asks for emergency relief that would stop the contracts from trading while the case is heard.
The group contends the products are security-based swaps, which would place them under the Securities and Exchange Commission's exclusive jurisdiction rather than the CFTC's. It also argues the CFTC violated the Administrative Procedure Act by failing to explain its decision or adequately weigh the effect on investors and securities markets. Adam Ford, secretary of the Capital Markets Alliance, said the rapid rollout of such products "erodes investor protection and undermines the integrity and resiliency of the American financial system."
The CFTC's Position
The lawsuit follows an announcement by CFTC Chairman Michael Selig that perpetual futures on individual US stocks could begin trading on qualifying regulated exchanges. Selig said the contracts were approved as security futures under the Commodity Futures Modernization Act of 2000, which makes them subject to oversight by both the CFTC and the SEC. The products give traders leveraged exposure to single stocks without holding the underlying shares and without the expiration dates that apply to traditional futures.
The agency said bringing these products onto regulated US venues would give investors an alternative to offshore platforms. A CFTC spokesperson described the lawsuit to Reuters as a troubling attempt to interfere with regulated markets.
Coverage Differences and Open Questions
The two reports differ on how the complaint is framed. One describes the suit as targeting Coinbase, Kalshi and Bitnomial, naming the firms whose contracts would be listed as security futures, and seeking emergency relief to block that listing. The other focuses on the statutory argument and the Administrative Procedure Act claim without naming the platforms. Neither source independently confirms the full list of defendants or products in scope, so readers should treat the named platforms as reported rather than verified against the docket.
The dispute also sits alongside a separate suit CME Group filed in June challenging the CFTC's approval of crypto perpetual futures offered by Kalshi and Coinbase. Whether the court treats the single-stock and crypto perpetual cases together, and how quickly it rules on any request for emergency relief, remains unresolved.
Why It Matters
For Traders
If the court grants emergency relief, open positions in newly listed single-stock perpetuals on the named platforms could face sudden trading restrictions or forced changes in listing status.
For Investors
The outcome will clarify whether the CFTC or the SEC governs single-stock derivatives, a jurisdictional question that will shape the regulated product landscape for years.
For Builders
Teams building perpetual or derivatives products on US-regulated venues should track whether security-futures classification holds, since it determines the compliance regime their contracts must meet.
This article is for information only and is not financial advice. Read the full disclaimer.
