CFTC Staff Clears DCMs to Convert Perpetual-Style Index Futures Into True Perpetuals

CFTC staff cleared designated contract markets ("DCMs") to remove expiration dates from existing perpetual-style futures on broad-based security indices without waiting the usual 10 business days. The relief expires October 20, 2026.

In a no-action letter, the Division of Market Oversight responded to a request from Coinbase Derivatives, LLC, under Rule 140.99. The exchange had listed contracts expiring up to 25 years out because it was unsure how perpetual futures would be classified. The CFTC deemed a similar KalshiEX LLC perpetual contract approved on October 2, 2026, which the Division said confirms such contracts are futures.

The Division cautioned that changing material terms of a contract with open interest can move prices and create gains or losses unrelated to fundamentals. It said the effects on price discovery and hedging are hard to predict.

The Division will not recommend enforcement action against the exchange or any other DCM that makes the change effective immediately. It also will not stay the amendments under Rule 40.6. The relief does not cover perpetual-style contracts on other assets.

Before implementing, a DCM must:

• amend only existing contracts on broad-based security indices, and change no material term other than expiration;
• (i) solicit feedback on adverse impacts from participants with open positions, (ii) give them at least five calendar days' notice, (iii) let them close out under existing terms, and (iv) provide appropriate risk disclosures;
• file the amendments under Rule 40.6(a) or Rule 40.5; and
• notify the Division it is relying on the letter, certify compliance, and identify the covered contracts.

An intermediary's customers count as market participants for the feedback, notice, close-out, and disclosure conditions. The Division may further condition, modify, suspend, or terminate the relief. The letter reflects only Division views and does not bind the Commission.