CFTC Seeks Public Feedback on Perpetual Contracts in Derivatives Markets

The Commodity Futures Trading Commission (CFTC) has issued a Request for Comment to evaluate the potential uses, benefits, and risks of perpetual contracts in regulated derivatives markets. The initiative was launched jointly by the CFTC’s Divisions of Market Oversight, Clearing and Risk, and Market Participants. The review aims to help regulators better understand perpetual derivatives following significant recent interest from trading venues and industry participants. Acting Chairman Caroline D. Pham stated that technological innovation has expanded access to financial markets, creating new opportunities alongside distinct risks. Pham noted that the regulator is taking a fundamental approach by seeking public input on the evolving product structure. The agency is seeking detailed comments on the operational and structural characteristics of perpetual derivatives, including variations among different instruments. The request also addresses the implications of these contracts for trading, clearing, and risk management frameworks. Furthermore, the CFTC is examining potential risks associated with perpetual products, specifically focusing on customer protection, market integrity, and retail trading activity. Public comments are being accepted through the CFTC Comments online portal, with the submission deadline set for May 21.