CFTC and SEC Seek Comment on Derivatives Definitions as CME Sues CFTC Over Perpetual Futures

The Commodity Futures Trading Commission and Securities and Exchange Commission issued a joint request for public comment on Thursday on updating and clarifying how they define key derivatives definitions, touching on the same legal question now being litigated in CME‘s lawsuit against the CFTC.

The request seeks input on whether greater clarity is needed on Title VII derivatives definitions, including the treatment of swaps, security-based swaps, mixed swaps, and novel products such as cash-settled perpetual contracts and event contracts.

“Today’s joint request for public comment presents an opportunity to address longstanding ambiguities within Title VII of Dodd-Frank that have stifled fair competition and responsible innovation,” CFTC Chairman Michael Selig said. SEC Chairman Paul Atkins said clarification was “long overdue” on Title VII definitional issues, specifically citing event-based products. The comment period runs 60 days after publication in the Federal Register.

The request arrives directly on the heels of a legal fight over that very definition. CME Group sued the CFTC on Thursday over its decision to approve Kalshi‘s perpetual futures as futures contracts. CME’s complaint alleges that in approving the products, Selig overrode the established definition of a swap and sidestepped the regulatory regime that should apply, letting new entrants compete for CME’s retail futures customers. CEO Terrence Duffy had argued earlier in the week that perpetual futures, in which two parties exchange ongoing payments, meet the Dodd-Frank definition of a swap rather than a future.

The two developments pull in opposite directions on the same issue. CME is asking a court to find that the CFTC misclassified perpetuals, while the CFTC and SEC are inviting the public to help redraw the definitional lines administratively. The CFTC told reporters it intends to seek dismissal of CME’s suit, characterizing it as running counter to the Trump administration’s pro-innovation agenda. How the “swap” question resolves, in court, through rulemaking, or both, will shape which regulator oversees perpetual futures and prediction-market contracts, and under what rules new entrants can enter the US derivatives market.

Update, Friday, June 19, 2026, 4:50pm ET: The original version of the article misstated the scope of the request for comment.

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