Four Stocks, 4.9x, and a Judge Who Just Called the CFTC's Bluff

Stock perpetual futures are still trading, and that's the story. Judge Valerie Caproni denied an emergency restraining order on Nov. 3, which means Kalshi, Coinbase Derivatives and Bitnomial keep their single-stock perps live while the lawsuit grinds along.

Don't mistake survival for a win. In the same order, Caproni wrote that the challengers are likely to succeed on the merits of their claim that the CFTC lacks statutory authority to offer perpetual derivatives on individual stocks to retail traders. Her reasoning is tidy, and it's rough for the agency. A contract with no expiration date and no delivery obligation isn't a sale for future delivery of a single security, so it can't be a security future. It reads like a swap. And single-name swaps sit with the SEC.

The plaintiff is the Capital Markets Alliance Association, a New York nonprofit whose members include Cboe Global Markets, Citadel Securities and the Healthy Markets Association. Case No. 1:26-cv-09608, Southern District of New York. The group wants all three approvals unwound.

Kalshi didn't flinch. By Wednesday morning it was quoting four single-stock contracts, Qualcomm, McDonald's, Amgen and Costco, capped at 4.9 times. The CFTC's answer is due Nov. 6. The alliance's reply lands Nov. 10. A separate preliminary injunction motion is still hanging over the whole thing.

Here's why anyone in crypto should care about a fight over equity products. Perps are the core instrument of crypto derivatives, and venues like Kalshi and Coinbase have leaned on the CFTC's approval framework to bring them onshore. The agency cleared the first U.S.-listed bitcoin perp on May 29, and Kalshi listed it days later. That approval is a proxy for everything that follows, and it's already contested. CME Group sued the CFTC in June, arguing a contract built on funding payments is a swap, not a future. That one is pending in Washington.

So a federal judge has now said, at least preliminarily, that a contract without expiry doesn't behave like a future. The New York order covers securities, not commodities, but precedent has a way of traveling. Professional traders are pricing in a wider definitional fight, and the delta here isn't price, it's jurisdiction.

The real target is the paperwork. Exchanges filed on Sept. 18, the CFTC let its 45-day review window lapse without a written order, and the products went live under Regulation 40.3 as security futures. Effectively betting on a regulatory shortcut, and a judge just flagged it. Watch the injunction ruling. If Caproni's logic holds, the onshore perp business built on that shortcut gets much harder and much more expensive to defend.