For those who missed it, the CFTC recently closed the comment period for public comments on 24/7 Trading[1] and the listing of Perpetual-style futures contracts[2].
But these are not the only changes looming in the industry, based on the pending applications at the NFA for Introducing Brokers and FCMs[3], and at the CFTC for Exchanges[4].
Below, I will try my best to outline the most potentially impactful and meaningful updates as we enter the 2nd half of 2025.
24/7 Trading
In late April, the CFTC issued a Request For Comment (‘RFC’) to the industry with regard to 24/7 access to derivatives markets. Per the CFTC, ‘This request seeks comment on the implications of extending the trading of CFTC-regulated derivatives markets to an effectively 24/7 basis, including the potential effects on trading, clearing and risk management which differ from trading during current market hours. The request also seeks comment on the risks of 24/7 trading, and the associated clearing systems, including risks related to the areas of market integrity, customer protection, or retail trading.’
Almost before the ink was dry on this RFC, Coinbase Derivatives Exchange announced 24/7 access to Bitcoin and Ethereum futures contracts listed on their exchange[5], with the support of their clearinghouse, Nodal Clear[6].
The National Introducing Brokers Association (of which MetroTrade is a member) and others from within the industry outlined the following concerns regarding 24/7 access in their comment letters to the CFTC:
- Increased risks of customer defaults and unmet margin calls: Because banks are closed on weekends, there is currently no ability to post additional margin on a 24/7 basis. Over the weekend, margin calls could age to three or even four days which could result in cascading calls across central counterparty clearing houses.
- Increased costs to support maintenance, testing and surveillance: Firms currently use the time markets are closed to perform system maintenance, upgrade networks and run and analyze surveillance reports. Continuous trading will need to be supported by real-time monitoring and detection systems to ensure system resilience and emergency protocols are in place to protect market integrity.
- Increased personnel cost and demands on humans: Humans – read brokers here – need breaks too. At a minimum, continuous trading will require firms to increase staffing levels to adequately service customers and perform necessary operational and surveillance functions.
- Increased cybersecurity risk: Significant investment in both technology and staffing could impose substantial operational and financial burdens on all industry registrants.
Nodal partially addresses the first bullet point in their rulebook[7] by:
1) Requiring members to deposit or pay on the preceding business day such initial/variation margin as may be required by the clearing house for the period in question.
2) Meeting initial/variation margin calls for the preceding period on the next business day available.
A non-scientific poll of the submitted comments indicated support/resistance somewhat along traditional lines – established exchanges and commodity-focused players were not in favor, while new entrants and crypto-focused exchanges were highly in favor.
In the absence of any CFTC rulings, I foresee this question being answered by customer demand. Those that have customers that demand 24/7 access will find ways to ensure that access, while those that don’t, will not.
Perpetual-style futures contracts
Within the same period, the CFTC issued a Request for Comment on Perpetual-style futures contracts. This request seeks comment on the characteristics of perpetual derivatives, including those characteristics which may differ across products. as well as the implications of their use in trading, clearing and risk management. The request also seeks comment on the risks of perpetual derivatives, including risks related to the areas of market integrity, customer protection, or retail trading.’
To prevent putting everyone to sleep, I will forgo a lengthy description of perpetual futures and the how or why they may be defined by some as a swap instead of a future.
In short form, a perpetual future is a futures contract without an expiration date which uses a funding rate mechanism to periodically update the price of the futures contract to keep it close to the underlying spot price. Investopedia has an excellent primer on perpetuals that can be found here.
The reason the CFTC is seeking comment on this contract-type is that they have proven very popular on overseas crypto-derivative exchanges[8] and US exchanges are concerned that current volumes may erode in favor of these offshore (and unregulated) marketplaces if something isn’t done domestically.
Again, a non-scientific poll of the submitted comments indicates there is a misunderstanding among market participants of what exchange-traded perpetuals are and are not, with many people arguing against perpetuals but conflating them with the bilaterally-traded swap contracts that helped usher in the 2008 financial crisis. Unlike the swap contracts of a generation ago, on-exchange perpetual futures contracts will be settled daily, they will require a daily posting of margin, and margin calls will be enforced to ensure exchange risk management protocols are followed.
In the intervening months since the April RFC, CME Group has launched and Coinbase Derivatives Exchange has announced the launch of perpetual futures contracts via self-certification.
Both exchanges have created retail-focused contracts, with the CME group’s contracts[9] having a notional value generally smaller than the current micro suite.
Additionally, neither exchange has launched a true ‘perpetual’ – the CME’s contracts expire yearly (in June), while the CDE plans to expire their contracts every five years.
New Potential Industry Entrants and Other Notable Mentions
Although somewhat under-reported, in June Circle and Coinbase announced plans to allow Circle’s US dollar-pegged stablecoin to be used as margin collateral for US futures contracts traded on the Coinbase Derivatives Exchange in 2026, pending CFTC review and approval[10].
And in other industry news, there are currently ten pending FCM applications, seven pending exchange applications, and 1 recently approved exchange – Railbird Exchange, LLC. It has also been reported that Polymarket acquired QCX, LLC, a DCM and DCO[11].
In a review of the CFTC filing[12], Railbird is operating as a fully collateralized direct-access platform utilizing LedgerX as the clearinghouse and offering binary outcome and continuous contracts – i.e. a direct competitor to Kalshi. DraftKings is reported to be in discussions to purchase Railbird Exchange[13].
Perhaps more interesting, and fresh off their CFTC settlement[14], Gemini has submitted an application for the Gemini-Titan Exchange, another direct-access platform focusing on event and binary-type futures contracts[15]. The optics on this are fuzzy given that the CFTC sued Gemini in 2022 for misleading statements during previous interactions.
Based on the current list of ~62 active FCMs, ten applicants seems high given that would lead to a 16% expansion if all ten were ultimately approved and went live. While welcomed, I see this as an extension of the current higher interest rate environment and not sustainable. After all, less than five years ago FCMs were in such low regard that they were dissolving rather than having the licenses be sold or transferred[16].
In Summary
The confluence of these developments signals a transformative period for the futures industry, driven largely by competition from crypto markets and evolving customer demands for continuous access and innovative contract structures. While the influx of new market participants represents healthy competition and innovation, the sustainability of this expansion remains questionable given historical patterns and the challenging economics of running futures businesses.
As the industry adapts (or not) to accommodate 24/7 trading and perpetual contracts, the real test will be whether these innovations enhance market efficiency and customer experience without compromising the risk management principles that have made U.S. futures markets the global gold standard. The next twelve months will likely determine which of these initiatives become permanent fixtures of the futures landscape and which prove to be temporary responses to current market pressures.
[1] https://www.cftc.gov/PressRoom/PressReleases/9068-25
[2] https://www.cftc.gov/PressRoom/PressReleases/9069-25
[3] https://www.nfa.futures.org/registration-membership/membership-and-directories.html
[5] https://www.coinbase.com/blog/24-7-futures-trading-has-arrived
[7] https://www.nodalclear.com/wp-content/uploads/nodal-clear-rulebook.pdf
[8] https://www.coingecko.com/en/exchanges/derivatives
[9] https://www.cmegroup.com/markets/spot-quoted-futures.html
[10] https://cointelegraph.com/news/coinbase-nodal-circle-usdc-eligible-collateral-us-futures
[12] https://www.cftc.gov/IndustryOversight/IndustryFilings/TradingOrganizations/50090
[14] https://www.coindesk.com/policy/2025/01/07/gemini-agrees-to-pay-5-m-settlement-in-cftc-case
[15] https://www.cftc.gov/IndustryOversight/IndustryFilings/TradingOrganizations/44472
[16] https://www.marketswiki.com/wiki/Rand_Financial_Services,_Inc.