In this article5 sections
Coinbase, Kalshi and four other companies asked a federal court to accept an amicus brief defending the Commodity Futures Trading Commission’s authority over perpetual futures tied to individual US stocks, Cointelegraph reported. The proposed brief was shared Monday by Coinbase legal representative Molly Abraham.
The group also includes Kraken parent Payward, trading firms DRW Holdings and Jump Trading, and crypto investment company Paradigm Operations, which filed in the US District Court for the Southern District of New York. The case, Capital Markets Alliance Association v. Commodity Futures Trading Commission, No. 1:26-cv-09608-LGS, turns on whether stock perpetuals qualify as security futures under joint CFTC and Securities and Exchange Commission oversight.
Also read: Judge denies CFTC emergency motion to halt New York enforcement case against Kalshi
Key facts
- Coinbase Derivatives, KalshiEX and Bitnomial Exchange submitted applications on September 18, 2026 to list perpetual contracts on individual large-cap US stocks; under the CFTC’s review process they were deemed approved on November 2, according to crypto.news.
- The Capital Markets Alliance Association, whose members include Cboe and Citadel Securities, sued to challenge those approvals, arguing that contracts with no fixed expiry should be regulated as security-based swaps under the SEC.
- US District Judge Valerie Caproni found the alliance likely to succeed on its claim that the CFTC exceeded its statutory authority, but denied a temporary restraining order, leaving the approvals in place.
- The six firms argued that the Commodity Exchange Act permits perpetual contracts to sit inside the existing security futures framework even without a fixed expiration date, crypto.news reported.
- Payward owns Kraken and acquired Bitnomial earlier this year, crypto.news reported; Crypto Briefing noted that the CFTC approved Bitcoin perpetual futures in May 2026, before the push extended to equity perps.
What the filing argues
In the proposed amicus brief, the companies contend that a fixed expiration date is not a requirement for a contract to qualify as a security future. Crypto Briefing quoted the filing’s position that, in the firms’ words, a security future by definition cannot be a swap. Abraham said Congress established the framework for security futures through legislation enacted in 2000.
The firms also point to procedural history: they say both regulators took part before the applications were cleared, with the SEC participating in the public consultation and exchanges submitting listing standards to both agencies. Crypto.news reported that Coinbase had already filed SEC registrations in September covering its derivatives exchange and brokerage operations.
The dispute over classification
The alliance’s suit, described in the court complaint, claims the CFTC failed to explain its decision adequately and did not weigh consequences for securities markets. Adam Ford, the association’s secretary, said products introduced outside established requirements could weaken investor protections and market oversight, crypto.news reported.
Caproni’s preliminary view sided with the plaintiff’s reading of the law: she questioned whether perpetual derivatives meet the statutory definition of security futures because they do not provide for delivery of a security on a specified future date, and found they appeared instead to fit security-based swaps. The reports diverge slightly on timing: Cointelegraph and Crypto Briefing place the suit on November 2 and November 3 respectively, while crypto.news dates the filing to November 2. The court did not stop trading in the meantime.
Why it matters
The outcome will shape whether US exchanges can offer retail traders stock-tracking contracts that never expire, a product line that until now sat in the space between futures and swaps. A ruling against the CFTC would pull single-stock perps toward SEC jurisdiction, where retail trading faces tighter limits, and would affect the exchanges whose applications are already live as well as the trading firms that plan to participate. It also tests how far the CFTC’s product review process can move before courts step in.
What to watch
The alliance was scheduled to file its reply to the CFTC’s opposition to a preliminary injunction on Tuesday, after the CFTC’s opposition was due November 6, per crypto.news. The court’s ruling on that injunction request will decide whether the approvals stay in force while the underlying classification question is litigated.
This article reports on a legal dispute and is not financial advice; markets for derivatives and the underlying equities are volatile and uncertain.
Reported by Cointelegraph.
Sources: Cointelegraph, crypto.news, Crypto Briefing