A key debate is emerging in the U.S. regarding the crypto assets derivatives market. The issue centers on whether U.S. regulators should classify the “crypto assets perpetual contracts” offered by the online trading platform Kalshi as “futures” or “swaps.”This debate has sparked a clash of opinions among veteran derivatives market experts and highlights deep-rooted challenges within the regulatory framework for crypto assets. Specifically, according to a report dated June 12, 2026, it has been pointed out that this classification could have a significant impact on how the crypto assets market is supervised in the future and on the nature of investor protection.Let’s take a closer look at why this classification is important and what the key points of contention are.
- What Are Crypto Asset Perpetual Contracts?
- Financial Products Offered by Kalshi
- Issues Surrounding Classification by U.S. Regulators
- The Difference Between “Futures” and “Swaps”
- Diverging Views Among Derivatives Experts
- The Importance of Regulatory Classification and Its Impact on the Market
- Outlook and the Situation in Japan
What Are Crypto Asset Perpetual Contracts?
Crypto asset perpetual contracts are derivative contracts with no fixed expiration date. Unlike standard futures contracts, they do not have a set maturity date. As a result, traders can hold their positions indefinitely.
These contracts primarily use cash settlement (settling only the profit or loss from the trade) rather than the physical delivery of assets. Prices are linked to an index price, and a mechanism called the funding rate adjusts for any deviation from the spot price.
They are offered by many crypto asset exchanges, and because they allow for trading with high leverage, they are often used for speculative trading. However, due to their innovative nature and high risk, they are subject to scrutiny by regulatory authorities.
Financial Products Offered by Kalshi
Kalshi is a platform that offers event-based derivative trading. Users can trade contracts that predict the outcome of specific events. It has been reported that the platform also offers perpetual contracts related to crypto assets.
The company’s services are creating a new derivatives market through an approach that differs from traditional financial markets. However, this uniqueness also makes it difficult to comply with existing regulatory frameworks.
In particular, the combination of crypto assets—a new asset class—and the perpetual contract format presents new challenges for regulators.
Issues Surrounding Classification by U.S. Regulators
In the United States, the regulatory body responsible for financial products varies depending on their nature. The Commodity Futures Trading Commission (CFTC) oversees commodities such as futures and swaps, while the Securities and Exchange Commission (SEC) oversees securities.
If crypto asset perpetual contracts are classified as “futures,” they fall under the jurisdiction of the CFTC. On the other hand, if they are classified as “swaps,” they also fall under the CFTC’s jurisdiction, but the applicable regulations and reporting obligations differ.
This classification has far-reaching implications, affecting exchange licensing requirements, customer protection rules, market transparency, and the rigor of regulatory oversight. Therefore, clarifying their legal nature is of utmost importance to market participants.
The Difference Between “Futures” and “Swaps”
A “futures” contract is a standardized agreement to buy or sell a specific asset at a predetermined price on a specific future date. It is typically traded on an exchange, and settlement is guaranteed by a clearinghouse (an institution that guarantees the settlement of trades).
On the other hand, “swap” contracts are essentially over-the-counter (OTC) transactions—direct deals between two parties—that promise the exchange of future cash flows. They are highly customizable and are often traded in the OTC market (markets that do not involve exchanges).
Crypto asset perpetual contracts are traded on exchanges and feature mechanisms that function similarly to clearing houses, making them similar to futures in some respects. However, they also possess swap-like elements, such as the absence of an expiration date and the mechanism for funding rates.
Diverging Views Among Derivatives Experts
Opinions are divided among experts with extensive experience in the derivatives market regarding this classification. One expert argues that perpetual contracts are similar to futures contracts because they are traded on exchanges and have a clearing mechanism.
Another expert points out that, due to their lack of maturity and their flexibility, they share many characteristics with swap contracts. This divergence of opinion highlights the current reality that existing financial product regulations do not fully align with the combination of new technology and financial products known as crypto assets.
Regulators are currently in the process of carefully considering how to fit these new financial products into the existing regulatory framework. It may still take some time before clear guidelines are established.
The Importance of Regulatory Classification and Its Impact on the Market
Clarifying the regulatory classification of crypto asset perpetual contracts is essential for the healthy development of the market. If classified appropriately, investors will receive clearer protection, and market participants will gain guidance on compliance.
On the other hand, if the classification remains ambiguous, there is a risk of regulatory loopholes emerging or investor protection becoming inadequate. Furthermore, market transparency could be compromised, and the risk of misconduct could increase.
The outcome of this debate will be a key factor in determining the future structure of the crypto asset derivatives market in the United States. Clear regulations also have the potential to encourage institutional investors to enter the market and enhance market liquidity.
Outlook and the Situation in Japan
The debate among U.S. regulators regarding the classification of crypto asset perpetual contracts has not yet reached a conclusion. However, developments in this debate could influence trends in crypto asset regulation around the world.
In Japan as well, the Financial Services Agency (FSA) applies strict regulations to crypto asset derivatives trading, such as leverage restrictions and an exchange registration system. It is conceivable that the U.S. debate could indirectly influence the future decisions of Japanese regulators.
The crypto assets market is constantly evolving, and regulations will change accordingly. Market participants are required to stay abreast of the latest regulatory trends and implement appropriate risk management.
[Source: Original Article]
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