The US Commodity Futures Trading Commission’s (CFTC) approval of the first Bitcoin (BTC) perpetual futures contract on Kalshi is being viewed by the wider crypto industry as more than just a new regulated digital assets launch. In just the last two days, Kalshi has self-certified over 20 additional crypto perps including the likes of ETH, LINK, SOL and XRP.
Following years of operating largely outside traditional financial infrastructure, crypto’s most intriguing products are increasingly finding their way into Wall Street-adjacent territories. Between the approval of Kalshi’s Bitcoin perps, the CFTC’s no-action relief related to Coinbase and Deribit, and the growing push toward tokenized securities, many in the industry see the lines between crypto and traditional finance beginning to blur.
“The CFTC tried to fit the square peg in the round hole by looking at it in a way that ‘futurity’ refers to future executory payment obligations, not necessarily a fixed end date. This is a new legal theory,” Peter Sanchez Guarda, a former CFTC Special Counsel in the markets participants division and founder and principal consultant at TurnKey Family Office, told DeFi Rate.
The approval has also fueled broader discussion about whether one of crypto’s most successful financial products is starting to transition from offshore and crypto-native venues into regulated markets, marking the start of a new phase in the industry’s evolution.
US crypto traders have been locked out of most global crypto markets
For years, US crypto users have operated with a structural limitation that many in the industry argued has significantly shaped market behavior: restricted access to the majority of global crypto derivatives liquidity.
According to Coinbase CEO Brian Armstrong, US crypto users have been excluded from roughly 80% of global crypto trading activity, largely concentrated in perpetual futures and options markets.
While spot trading has remained widely accessible in the US, perps became the dominant form of trading globally. Their total trading volume on centralized and decentralized exchanges in 2025 surged by more than 64% to $92.9 trillion year-over-year, during a very volatile market when BTC and many other cryptocurrencies “bled.”
Speaking of the CFTC decision, Dylan Dewdney, the co-founder and CEO of Kuvi.ai, said it acts as a signal that the speculative impulse in the country will “not be checked anytime soon.”
“… That is both bad and good. Preventing people from acting freely with their own assets runs against the core libertarian ethos of the US. At the same time, protecting people from rampant scamming, abusive leverage, and predatory market structure is also part of good government. Right now, the balance seems to be shifting toward access, with regulation wrapped around it rather than prohibition.”
Why perps became crypto’s dominant market structure
Perpetual futures evolved into a dominant trading instrument because they remove many of the constraints of traditional futures contracts. They have no expiration date, offer traders continuous leverage, and efficient funding rates to maintain efficient price alignment with spot markets.
As a result, liquidity naturally concentrates into a single, always-on instrument rather than being fragmented across expiries and contract structures, thus making perps more capital efficient for both retail traders and professional market makers. A key player in the field was Hyperliquid, which delivered “the first truly competitive” perpetual decentralized exchange experience on the market.
The platform’s launch of HIP-3, which allowed third-party deployers to launch new perpetual markets on the platform’s order book, saw a rapid growth of new markets, including single-name equities, equity indices, commodities, and pre-IPO private companies.
“To date, these new markets have driven over $100B in volume, marking the most successful attempt so far in bringing traditional asset classes on-chain at meaningful scale,” Twitter user @defi_monk said in an article on the platform.
Pantera Capital recently argued that Hyperliquid’s importance now extends beyond crypto, describing the platform as an emerging 24/7 venue for price discovery across financial markets. The firm pointed to instances where traders used Hyperliquid to react to major macroeconomic and geopolitical developments while traditional exchanges were closed, allowing prices to be established on the platform before conventional futures markets reopened.
The legal novelty
Historically, perpetual futures were viewed as structurally incompatible with traditional futures regulation due to their lack of an expiry date. That assumption is now being challenged from within the regulatory system itself.
As Guarda explained, the CFTC’s approval of BTC perps on Kalshi is “a novel view of what a futures contract is,” arguing that the legal reasoning stretches the traditional concept of “futurity” beyond its historical bounds.
In his view, the key issue is that regulators are relying on limited precedent, particularly older “index participations” style structures, to justify classifying perpetual-style instruments as futures. However, even those cited examples still contained an implicit expiry or settlement cycle, meaning they were structurally closer to traditional futures than true perpetuals.
The broader implication is that this could be less a settled legal doctrine and more an interpretive expansion. That matters because, in previous attempts by the CFTC to extend jurisdiction into adjacent areas such as FX “rolling spot” or agricultural “hedge-to-arrive” contracts, courts have pushed back rather than accepted broad reinterpretations. Especially in environments where agencies no longer benefit from Chevron-style deference.
Crypto demand shifts back onshore
Beyond the legal debate, market participants increasingly view the approval as part of a broader maturation of crypto market infrastructure.
According to Kuvi.ai’s Dewdney, the key opportunity lies in bringing demand that has historically been concentrated on offshore venues into more transparent and regulated US markets, while avoiding what he described as a “retail leverage casino under the branding of innovation.”
“The US is no longer just debating whether crypto speculation should exist. It is beginning to decide where it should happen, under what rules, and who gets to build the venues,” he said.
