US CFTC rejects CME’s standing to sue, stating that the latter failed to adequately demonstrate financial harm caused by the perpetual contract policy.

The U.S. Commodity Futures Trading Commission (CFTC) stated in recent court filings that CME Group merely claims heightened competition, but has not reasonably demonstrated imminent financial harm — a deficiency that leaves it insufficient to establish standing to challenge its perpetual contract policy. The CFTC noted that CME’s crypto futures trading volume has actually risen following the policy adjustment. The CFTC approved Kalshi’s first bitcoin perpetual contract in May this year, and said it would regulate such products as futures on a case-by-case basis. For its part, CME argues that perpetual contracts have no expiration date and should be classified as swaps rather than futures, falling under a separate regulatory framework. The CFTC had asked a federal judge to dismiss the case last month, and the latest filings further elaborate on its rebuttal to CME’s standing claim. The regulator also pointed out that CME previously told investors it had not received client demand for perpetual contracts, and that such products cannot replace its existing futures, arguing CME should not take conflicting positions in court and earnings calls. TD Cowen policy analyst Jaret Seiberg believes CME may still hold the upper hand in arguments regarding standing and the classification of the products as swaps. However, he expressed concern that if the perpetual contract market continues to grow during the litigation, it could become far more complex to unwind the market later if CME prevails in the case.