An outgoing commissioner of the U.S. Commodity Futures Trading Commission (CFTC) said the regulator is prepared to authorize perpetual futures contracts. Unlike event contracts with a fixed end date or a definitive outcome, perpetual outcomes allow investment in a position that continues indefinitely.
The potential regulation of crypto perpetual futures contracts allows traders to purchase futures that have no term limits or set pricing. The contracts are offered offshore by major crypto entities including Binance and recently drew the attention of regulators.
CFTC Commissioner Summer Mersinger spoke to Bloomberg TV about the authorization of crypto perpetual futures contracts, which would be another major departure for the CFTC in terms of expansion. Mersinger believes the CFTC is set to regulate perpetual contracts.
“I believe we’ll have some of those products trading live very soon,” Mersinger told Bloomberg. “It would be great to get that trading back onshore in the United States.”
The CFTC began accepting public comment on perpetual futures in April as event contracts became a topic of discussion and markets outside the U.S. allowed crypto contracts.
The regulator is now considering the launch of the contracts.
“The CFTC is uniquely positioned to be the right regulator for the crypto spot market,” continued Mersinger. “We already have a lot of regulatory oversight of trading that happens in the futures market on some of these assets.”
Leadership changes at the CFTC
The future of crypto and sports contracts is bright as Brian Quintenz prepares to step into the role of CFTC Chairman. Quintenz, who is considered a crypto expert, is assuming the role as chairman after serving as an advisor for Crypto.com for two years, pending Congressional approval. He is also on the board of directors of prediction market Kalshi— a position he has held since 2021.
“We have a very strong incoming [CFTC] chairman who has a great voice for the crypto industry and will be a real advocate for the industry and the agency,” added Mersinger.
Earlier this month, the D.C. Circuit Court of Appeals granted the CFTC’s request to dismiss its case against Kalshi regarding election contracts. The dismissal ended a year-long battle over the legality of election contracts after the CFTC took a stance against them.
Quintenz is familiar with the CFTC as he was initially appointed as a commissioner in 2016 by President Barack Obama. Congress failed to approve the nomination before Obama’s term ended. President Donald Trump re-nominated Quintenz in 2017 with him serving as a commissioner until 2021. Quintenz also worked at investment firms Andreessen Horowitz, Hill-Townsend Capital and Saeculum Capital Management.
Quintenz is still awaiting congressional confirmation for his role as CFTC Chairman with Mersinger set to relinquish her role as commissioner on May 30. Mersinger is leaving the CFTC to join the Blockchain Association as the crypto trade group’s new CEO.
The CFTC is poised for more changes with several staffers on administrative leave pending an investigation. The probe is for “potential violations of laws, government ethics requirements and professional rules of conduct.” It is unclear what issue it is investigating.
The CFTC also planned to hold a roundtable to discuss the regulation of sports event contracts. Last month, the regulator canceled the discussion that was set for April 30.
