Perpetual contracts were not on the agenda for the first meeting of the Commodity Futures Trading Commission's Innovation Advisory Committee on August 20, which covered digital assets, artificial intelligence, and prediction markets, but members raised them in all three sessions. That recurrence reflects the growing role perpetual contracts play in global derivatives markets and the rising demand for them among American market participants.

Today, HPC submitted a statement in connection with the Committee's inaugural meeting. Our statement makes four points:

1. Perpetual contracts are central to the Commission’s innovation agenda; 

2. Perpetual contracts serve the risk management needs of a diverse set of market participants; 

3. The Commission’s innovation-forward approach is bringing perpetual contract markets onshore; and 

4. Onchain infrastructure can modernize the U.S. derivatives markets within existing legal and regulatory frameworks. 

The perpetual contract first found its footing in digital asset markets, where it became the most actively traded derivative product, and has since expanded into equities, commodities, and other traditional asset classes. On Hyperliquid alone, perpetual contracts deployed by third-party builders have accumulated more than $500 billion in notional trading volume across more than 80 traditional commodity and equity markets.

Perpetual contracts are particularly useful for commercial hedgers whose exposure has no end date. For example, an airline hedging fuel consumption, an investment fund managing portfolio exposure, and an AI developer facing rising compute costs all carry exposures that run continuously. Hedging those exposures with dated futures contracts, which expire on a fixed date, means managing a roll cycle across contract months, with timing risk and transaction costs at every roll. A perpetual contract removes that machinery. It has no expiry date, rollover, or delivery. Periodic funding payments anchor its price to a reference asset, allowing a hedger to maintain one position for as long as the underlying exposure lasts. As our recently published research shows, perpetual contracts complement dated futures rather than displace them, while dated contracts remain well-suited to manage risks tied to fixed calendar dates. 

The CFTC has taken concrete steps this year to onshore perpetual contract markets. In May, the Commission approved the first U.S.-listed perpetual futures contract, published a policy statement on perpetual contract listings, and issued staff guidance on continuous trading. In June, the Commission asked for public comment on extending the product class to energy commodities. HPC and trade[XYZ] filed a joint comment letter in that proceeding this week. A new request for comment on compute derivatives asks whether perpetual compute futures could offer advantages unavailable through existing products.

Regulatory clarity is also increasing competition among exchanges. The CFTC now regulates 30 designated contract markets (the exchanges permitted to list futures), up from 16 in 2003, with 17 new applications pending, and the number of listed contracts in Commission-regulated markets has more than tripled in three years. New entrants compete in part by listing products that serve demand that incumbents have left unmet, and U.S.-listed perpetual contracts are the latest example of that pattern.

Innovation in U.S. derivatives markets extends beyond new products. Onchain infrastructure can also modernize how markets operate within the framework that the Commission already administers: a public blockchain records every market, order, and position in a transparent ledger, reassesses margin programmatically and continuously rather than in batch cycles, and moves collateral in real time, all of which reduces counterparty credit and settlement risk.

Integrating onchain infrastructure into regulated markets does not require rewriting the Commodity Exchange Act from the ground up. The statute's principles-based framework regulates functions and outcomes, and registrants have long relied on third-party technologies, from matching engines to risk systems, to carry out regulated activities. Public blockchains are the newest generation of that infrastructure, and targeted guidance on how registrants may use them could resolve many of the near-term regulatory questions.

HPC is focused on advancing a clear, regulated path for Americans to access onchain markets. We will continue providing the Committee and Commission staff with research and technical documentation as that work proceeds. CFTC Chairman Michael Selig has said that the goal is for American regulation to keep pace with American innovation. Perpetual contracts are one of the defining financial innovations of the past decade, and they belong on American soil.

Our full statement is available here.