Former SEC and CFTC officials urge lighter regulatory touch on crypto perpetuals trading to bring the $90 trillion market onshore.
DeFi & Yields ·
The SEC and CFTC are advancing separate rulemaking efforts on crypto derivatives and custody while market-structure legislation remains in congressional recess. A bipartisan group of former officials from both agencies—including former CFTC Chairman Chris Giancarlo and former CFTC Commissioner Brian Quintenz—has submitted a comment letter arguing that regulatory clarity is needed to prevent further market migration overseas.
The letter addresses how swaps, security-based swaps, and emerging derivatives should be classified and where jurisdiction between the two agencies should be drawn. The signatories contend that inconsistent or overlapping rules impose unnecessary compliance burden and that similar risks warrant similar treatment across regulators. Prediction market platform Kalshi estimates that offshore perpetuals trading reached $90 trillion in 2025, compared to around $28 trillion two years earlier, illustrating the scale of activity currently operating outside U.S. regulatory frameworks.
What remains unclear is whether the agencies will adopt the former officials' recommendations for lighter-touch rules or how quickly either regulator will finalize new guidance. The outcome will likely shape whether platforms offering crypto perpetuals derivatives choose to operate domestically or remain offshore, though the timing and specific regulatory parameters for onshore operations have not yet been announced.