CFTC Clears Perpetual Futures for U.S. Crypto Trading Despite Leverage Concerns
CFTC Chair Michael Selig defended the agency's late-May decision to allow perpetual futures contracts, citing the need to regulate products already popular overseas.
cryptoslate.comU.S. oversight. He spoke during an appearance on CNBC's Fast Money program.
The CFTC approved Kalshi in late May to offer bitcoin perpetual futures. Kalshi later expanded the contracts to other cryptocurrencies. The platform reported more than $3 billion in notional volume from the contracts in just over a week of beta testing.
Kalshi CEO Tarek Mansour said the maximum leverage allowed on the contracts is around six times. Selig addressed concerns about retail investor risk, stating that brokers must evaluate customer suitability and that proper disclosure will be required.
"The notion that we should be paternalistic and allow for one type of product, because it's easier to understand, I think that's frankly a misunderstanding itself, because, of course, options are very complicated," Selig said.
Selig rejected claims that political pressure from President Donald Trump's administration influenced the decision. "That's absolutely absurd, that insinuation," he said. Donald Trump Jr. serves as a strategic advisor to Kalshi.
CME Group CEO Terrence Duffy had criticized the approval in a prior Fast Money appearance, citing leverage risks. Selig responded that incumbents often resist new products and that developing the contracts domestically allows stronger regulation than offshore alternatives. CNBC and Kalshi maintain a commercial relationship that includes customer acquisition and a minority investment.
