Wall Street Banks Weigh Perpetual Futures as Kalshi Charges Ahead

As regulated perpetual futures arrive in the United States, some trading firms and cryptocurrency exchanges are embracing them, while traditional Wall Street banks are taking a more cautious approach, CoinDesk reported Monday (July 27).

The banks are deciding whether this offering is a passing retail craze and are waiting until liquidity, rules and infrastructure mature, according to the report.

Meanwhile, Kalshi’s perpetual futures tied to bitcoin and other digital assets topped $1 billion in trading volume within a week of their launch in June, and the company is now seeking regulatory approval to offer ones tied to gold and silver, the report said.

The Commodity Futures Trading Commission (CFTC) gave both Kalshi and Coinbase approval to list perpetual futures in the U.S., per the report.

Proprietary trading firms, market makers and newer clearing firms are likely to be the next companies to get involved, according to the report.

Wall Street banks are likely to wait for liquidity, rules and infrastructure to catch up to the surging market, per the report.

It was reported in April that perpetual futures are one of the biggest and riskiest parts of crypto trading, that they make up more than 70% of centralized crypto exchanges’ volume, and that Kalshi and rival prediction market Polymarket were set to begin offering the products if the CFTC allowed the products in the U.S.

On June 1, it was reported that the CFTC cleared the way for Coinbase and Kalshi to offer perpetual cryptocurrency futures contracts to U.S. investors. The agency’s action moved the products from a regulatory gray area into a formal U.S. framework governed by federal derivatives laws, while also clarifying that any future perpetual contracts tied to assets beyond the currently approved listings would be subject to case-by-case review.

Kalshi said in a July 9 report that it aimed to expand into the derivatives space for things like metals, foreign exchange and energy markets and to compete against traditional exchange operators by offering perpetual futures.

Critics warn that perpetual futures contracts are risky for retail investors who might not understand their complexity and could suffer steep losses if prices shift against them even a little, per the report.