CFTC tells court CME lacks standing to block U.S. perps

The CFTC has pushed back in court against CME Group's lawsuit over the agency's new perpetual-futures policy, arguing in a brief filed Friday that the derivatives giant has not shown it is being harmed and therefore lacks legal standing. The CFTC noted that CME's crypto futures volume has actually risen since the policy shift.

The dispute stems from the CFTC opening the door to U.S. perps in May, approving Kalshi's first bitcoin perp and saying it would treat the contracts case-by-case as futures. CME sued in July, arguing perps — which have no built-in expiration — are really swaps that demand a different regulatory framework. The CFTC first asked a judge to dismiss the case in September.

• The agency contends "allegations of increased competition, without any plausible inference of an imminent financial injury," don't confer standing.
• TD Cowen's Jaret Seiberg says CME may still prevail on its swaps argument, while warning that continued perps growth during the litigation could complicate any unwind if CME wins.