CFTC Clears Index Futures to Become True Perpetual Contracts

CFTC Lets Exchanges Convert Index Futures Into True Perpetual Contracts

The Commodity Futures Trading Commission’s Division of Market Oversight said on Oct. 5 that it has issued temporary no-action relief to designated contract markets (DCMs) seeking to convert certain “perpetual-style” broad-based security index futures into true perpetual contracts.

The staff letter, identified as CFTC Letter No. 26-19, allows eligible exchanges to remove expiration dates from existing contracts and implement amendments that would turn them into perpetual futures—provided the exchanges meet specific customer-protection and procedural conditions. The no-action positions expire on Oct. 20, 2026.

Perpetual futures are derivatives with no fixed expiration. Instead of settling on a set date, they typically use a periodic funding-rate mechanism intended to keep the contract price aligned with the underlying spot market. The structure became dominant in offshore crypto derivatives markets, while U.S.-regulated venues have generally relied on traditional dated futures.

In this case, the relief applies to broad-based security index futures and is focused on converting existing “perpetual-style” products—contracts that functioned similarly but carried very long-dated expirations, in some instances extending up to 25 years. Division staff noted this approach emerged while the regulatory treatment of true perpetual futures in the U.S. was still being clarified.

The CFTC emphasized that exchanges cannot simply delete the expiry date without meeting the letter’s conditions. Among other requirements, DCMs must:

• Solicit feedback from market participants with open positions
• Provide advance notice and an opportunity for customers to exit positions under existing terms
• Deliver appropriate risk disclosures
• File the amendments under CFTC Regulations 40.5 or 40.6 and certify compliance with the letter’s conditions

The staff relief is framed as narrow and conditional, covering conversions of existing qualifying contracts rather than opening the door for any perpetual product to be listed without further regulatory process.

The move follows a series of coordinated CFTC actions earlier in 2026 that advanced the domestic trading of perpetuals in digital-commodity markets. In May 2026, the CFTC approved for listing on a DCM a true perpetual bitcoin contract that is cash-settled, references a real-time price index, trades on a 24/7 basis, and uses a funding mechanism to maintain price alignment. CFTC leadership described that step as part of an effort to bring risks associated with perpetual derivatives within U.S. oversight rather than leaving them offshore.

By extending a conversion pathway to certain index futures contracts—while keeping strict guardrails—the CFTC is providing U.S.-regulated exchanges a controlled route to test a contract structure long associated with crypto markets, without treating it as a blanket policy change.