Citadel Backed Group Sues CFTC Over Stock Perpetual Futures Approval

A new industry group called the Capital Markets Alliance went to federal court in New York on Tuesday to block the CFTC’s approval of single stock perpetual futures. It filed the same day the agency announced its decision. The group says it is backed by Cboe, Citadel Securities and the Healthy Markets Association, among others, though it has little track record beyond this case. Its argument is that these contracts are really security based swaps, which fall under the SEC, and that the CFTC broke administrative law by not explaining its policy or why it departs from an earlier position.

CFTC Response and Selig’s Position

Chairman Mike Selig said the policy takes perpetual futures beyond digital commodities and into traditional securities, building on the bitcoin perps path opened about five months ago. An agency spokesman called the group anonymous and said markets should be governed by law, not litigation campaigns meant to stop innovation.

CME and ASA Join the Opposition

This is not the first legal fight over perps. CME Group sued over the earlier crypto perps decision, arguing that contracts with no end date are swaps, not futures, and are treated differently under the rules. The American Securities Association also criticized the move, with CEO Chris Iacovella saying that labeling stock perps as security futures sidesteps the SEC and Congress’s ban on selling security based swaps to retail investors.