Kalshi's Bid for Non-Stop Stock Perpetuals Reignites CFTC-SEC Turf War

Kalshi is gearing up to request regulatory sign-off from U.S. authorities for roughly 60 perpetual futures contracts tied to individual stocks and exchange-traded funds, with names like Tesla, Apple and Nvidia reportedly on the list.

Kalshi's Plan to Trade Stock Perpetuals Around the Clock

According to a Wall Street Journal report published September 10, the prediction-market platform intends to make these products tradable 24/7. If regulators sign off, U.S. traders would gain a legal, domestically regulated way to trade single-stock perpetual futures, something previously accessible mainly through offshore crypto platforms.

So far, Kalshi hasn't disclosed which specific products it plans to list, what leverage caps or margin rules would apply, or when any of this might launch. The Journal's report did not point to any public filing tied to the plan, meaning the entire proposal still hinges on a formal application and regulatory review process.

A Contract Type Caught Between Regulators

This push lands in the middle of an ongoing turf battle involving the CFTC, the SEC, CME Group and Citadel Securities. At the heart of it is a disagreement over how perpetual contracts should legally be categorized, and which agency should actually be responsible for overseeing products linked to U.S. equities.

Unlike standard futures, which expire on set dates and require traders to close out or roll their positions, perpetual futures never expire. Traders can hold long or short positions indefinitely.

How Perpetual Contracts Track Their Underlying Assets

To keep prices aligned with the reference asset, perpetuals rely on periodic funding payments exchanged between long and short position holders. When the contract price rises above the reference asset's price, longs typically pay shorts; when it dips below, the payment flow reverses.

Leverage is another core feature, it lets traders control a position much larger than the collateral they've posted. That cuts both ways: profits can be amplified when the trade moves favorably, but so can losses, potentially triggering forced liquidation if the market moves against the position.

Which Stocks and ETFs Could Be Involved

Per the Journal's sourcing, Kalshi's planned lineup would include perpetuals tracking shares of Tesla, Apple and Nvidia, along with a batch of ETFs, though which specific funds weren't named in the report.

Round-the-clock trading would mean a Tesla-linked perpetual could keep moving in price long after Nasdaq shuts its doors for the day, and even through weekends, a sharp contrast to the underlying stock itself, which mostly trades within standard exchange hours plus limited extended-hours windows.

No Corporate Endorsement, No Ownership Rights

None of the companies whose shares would underlie these contracts have given their blessing to Kalshi. It's also worth noting that a perpetual future tracking Tesla or Nvidia wouldn't grant the holder any actual stake in the company, no shareholder voting rights, no dividend entitlement, nothing beyond price exposure.

Kalshi would also need to work out how it sets reference prices, structures funding payments, and handles corporate actions like stock splits, dividend payouts, mergers or trading halts, all of which can materially affect an underlying stock's price or structure. The company hasn't yet explained how it would manage these events, particularly how pricing would work while the actual stock market is closed.

From Bitcoin Perpetuals to a Broader Ambition

This isn't Kalshi's first venture into perpetual futures. The CFTC greenlit its BTCPERP Bitcoin contract on May 29, just a day after Kalshi submitted it for review, giving eligible U.S. traders a regulated, leveraged, expiration-free way to gain Bitcoin exposure.

As crypto.news has covered previously, that Bitcoin approval didn't come with a blanket green light for perpetuals tied to other asset classes. The regulator made clear that products linked to different underlying assets would likely need to be evaluated on a case-by-case basis. Since Kalshi's proposed equity products reference assets that fall under SEC jurisdiction, they'd require their own separate regulatory review.

Kalshi has since rolled out perpetual contracts for gold and silver, and is reportedly working on one tied to West Texas Intermediate crude oil. But approval for a commodity-linked product doesn't automatically settle the more complicated question of how single-stock perpetuals should be treated.

Where Jurisdiction Gets Complicated

That's essentially where the current jurisdictional standoff comes from. Futures products typically fall under the CFTC's authority, while securities like stocks are the SEC's domain, and some products blur the line depending on how they're legally structured.

There's precedent here: single-stock futures have existed before under a shared SEC-CFTC oversight model. But Kalshi's proposed contracts would work differently, they'd have no expiry date and would rely on funding-rate mechanics rather than a set delivery date to stay tethered to the underlying stock's price.

To be clear, the CFTC hasn't approved any of these equity-linked products yet. Kalshi's reported intent to file an application shouldn't be mistaken for regulatory authorization or a guarantee that trading is imminent.

Citadel Securities Pushes Back

Citadel Securities has formally told both the SEC and CFTC that perpetual contracts linked to publicly traded companies belong under securities regulation, not futures oversight. The firm's September 10 letter was submitted in response to a joint regulatory inquiry into how these products should be classified and divided between agencies.

Citadel's central worry is that moving equity-linked perpetuals outside SEC oversight risks creating what it called a "parallel shadow market." Its argument: regardless of how the contract is structured on paper, its actual economic value still flows directly from the underlying security.

The firm also pointed out that existing securities-surveillance systems are built to monitor activity across stocks, listed options and related products together. Splitting perpetuals off into a separate regulatory track, Citadel argued, could weaken regulators' ability to spot suspicious trading patterns across connected markets.

Insider Trading and Trading-Halt Concerns

Citadel flagged insider trading as a specific risk scenario, someone with access to unreleased earnings data could theoretically trade a company-linked perpetual contract even while the underlying stock exchange is closed, depending on the platform's own safeguards and applicable law.

Trading halts present a similar problem. Stocks routinely get suspended following major news or unusual trading activity, but a perpetual contract running on a separate, independently operated venue might just keep trading unless the two markets have coordinated procedures in place.

Citadel noted that SEC rules already provide a framework for order handling, market access and trading suspensions in securities markets, protections that wouldn't necessarily carry over in the same form if the CFTC ends up classifying single-stock perpetuals as standard futures contracts.

It's worth stressing that Citadel's letter represents the firm's own regulatory stance, not a legally binding ruling. Neither the SEC nor the CFTC has issued a joint decision on how Kalshi's planned products should be treated.

In a related development, Europe's securities regulator ESMA has separately warned that prediction markets carry their own insider-trading and manipulation risks, though that report deals with prediction platforms and EU market access, a somewhat different issue from Citadel's U.S.-focused surveillance concerns.

CME Group's Legal Challenge Against the CFTC

Separately, CME Group filed suit against the CFTC and its chairman, Michael Selig, back in June, challenging the agency's approval of perpetual futures for both Kalshi and Coinbase. This lawsuit is a distinct matter from Citadel's regulatory request regarding stock-linked products.

CME's core legal argument is that perpetual futures should actually be classified as swaps under the Dodd-Frank Act. The lawsuit asks a federal court in Washington, D.C. to strike down the CFTC's May 29 approval of Kalshi's Bitcoin contract, along with the broader policy behind that decision.

CME contends the approval put it at a competitive disadvantage, since it let Kalshi and Coinbase reach retail derivatives traders under a different, less stringent regulatory framework. Notably, neither Kalshi nor Coinbase is named as a defendant in the suit.

A CFTC spokesperson dismissed the lawsuit as "frivolous," while Kalshi framed the dispute as fundamentally about market competition. These are simply the parties' stated positions, the legal question of classification remains unresolved.

The Bigger Picture: A Fast-Growing Market

Global perpetual-futures trading volume jumped 29% to reach $61.7 trillion over 2025, based on CryptoQuant data reported by Reuters. That figure largely reflects crypto derivatives activity worldwide and isn't necessarily indicative of how much demand there'd be for U.S. stock-based perpetuals specifically.

The federal court overseeing CME's lawsuit hasn't yet ruled on whether the approved Bitcoin product should legally be classified as a future or a swap. Should that ruling go against the CFTC, it could undercut the regulatory basis Kalshi would otherwise rely on when pursuing approval for its stock and ETF contracts.

And even assuming the CFTC does approve Kalshi's applications, SEC involvement could still come into play depending on how the final products are structured. Neither regulator has set a review deadline, and Kalshi hasn't said when it actually plans to file its applications.