Regulated Perpetual Futures Arrive in the U.S., Drawing Cautious Attention From Wall Street

Perpetual futures, a staple of global crypto trading for years, are now making their way into regulated U.S. markets. Their arrival is prompting Wall Street to weigh whether "perps" are a short-lived retail phenomenon or a durable challenge to traditional listed futures. Early activity has been notable. Kalshi said its perpetual futures surpassed $1 billion in trading volume within a week of their June launch, marking the exchange's largest product debut since its prediction markets. Kalshi has also sought regulatory permission to list perpetual contracts linked to gold and silver, signaling ambitions beyond bitcoin (BTC) and other digital assets. Perpetual futures mirror standard futures in many ways but have no expiration date. Traders do not need to roll positions monthly or quarterly. Instead, periodic funding payments are used to keep prices anchored near the underlying asset. The contracts have become central to crypto market structure, and Bank of America has estimated annual perpetual futures volume at roughly $90 trillion. In the U.S., the regulatory gates are beginning to open. On May 29, the Commodity Futures Trading Commission (CFTC) cleared Kalshi to offer the contracts. Coinbase (COIN) has also received approval to list regulated perpetual futures domestically. Interest inside Wall Street does not translate into immediate adoption. People familiar with industry discussions said the topic is coming up more frequently as regulators allow activity that previously sat offshore to move onshore. Even so, most major financial institutions are still evaluating the product rather than preparing large-scale launches. Market participants expect proprietary trading firms, market makers and newer clearing firms to move first. Prop shops trade their own capital, giving them latitude to test new venues, take on operational risk and exit quickly if economics deteriorate. Large banks, by contrast, contend with tighter capital requirements, client obligations and reputational exposure. For many, the potential returns in a young market do not yet justify the cost of building the compliance, clearing and risk infrastructure required. That split matters because "Wall Street" encompasses groups that adopt at different speeds. Individual traders and smaller firms typically arrive first. Market makers tend to follow as volume grows. Banks often want years of data, well-defined regulatory treatment and robust market plumbing before committing meaningful balance sheet. Beyond speculation, advocates point to risk-management applications. Perpetual markets can trade 24 hours a day, potentially offering tools to hedge weekend risk when traditional futures markets are closed for part of the weekend. A trader carrying options exposure on Friday may be unable to hedge a sharp move until Sunday night. A liquid 24-hour perpetual market could allow firms to adjust positions as events unfold and use weekend pricing to gauge where CME futures may reopen. Industry sources said that could make perps valuable both for hedging and for price discovery. Still, adoption hinges on sustained customer activity. "The demand has to be there, or the capital won't be," one industry insider said, arguing firms will not commit balance sheet until volumes justify it. Liquidity remains a constraint. Round-the-clock trading does not guarantee institutions can execute large positions without moving prices. Weekend depth is still limited, and collateral and settlement systems do not always adjust as quickly as the markets they support. A regulatory dispute is also emerging. A central issue is whether certain perpetual contracts should be treated as futures or swaps, a classification that affects margin requirements, registration obligations and which firms can provide liquidity. Industry participants expect these legal questions to intensify if exchanges push perps into commodities, equities and other traditional asset classes. Competition is starting to shape the debate as well. CME has challenged the CFTC's handling of Kalshi's bitcoin perpetuals, arguing the contracts should face different regulation. Similar challenges could arise if perpetuals expand into equities and other markets. "A lot of this stuff... is more commercial than people are going to admit to out loud," another insider said, suggesting some resistance reflects incumbent exchanges defending existing revenue streams as much as concerns over market structure. For now, the prevailing stance on Wall Street is cautious rather than hostile. Trading firms see a familiar product, regulators see activity moving onshore, and exchanges see a chance to capture new volume. The largest banks are unlikely to lead, waiting instead for clearer rules, deeper liquidity and more mature infrastructure.