CME Chief Executive Terrence Duffy announced that the derivatives exchange intends to file a lawsuit against the U.S. Commodity Futures Trading Commission (CFTC) after the regulator approved perpetual futures products earlier this month.
He told CNBC on Wednesday that the CFTC’s approval of Kalshi’s perpetual futures product fails to satisfy the Dodd‑Frank Act’s swap regulations.
Under the Dodd‑Frank Act, the distinction between a swap and a futures contract is defined by the nature of the transaction. When two parties merely exchange payments, the arrangement qualifies as a swap, he explained. Consequently, these newly approved perpetual futures, which the CFTC has labeled as futures, would in fact constitute swaps and would be subject to the distinct regulatory requirements governing swap markets.
Duffy, who plans to step down from his position next year, stated that CME must first clarify the regulatory framework before considering the launch of its own perpetual futures contracts, noting that the applicable rules remain insufficiently defined.
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