CFTC Issues No-Action Letter on Perpetual Security Index Futures
The CFTC granted relief allowing designated contract markets to convert perpetual-style broad-based security index futures into true perpetual futures.
The Commodity Futures Trading Commission issued a no-action letter providing regulatory relief to designated contract markets, or DCMs, seeking to convert existing perpetual-style broad-based security index futures contracts into true perpetual futures, according to an agency announcement.
No-action letters from the CFTC signal that agency staff will not recommend enforcement action against a party that engages in activity that might otherwise raise regulatory concerns. In this case, the relief targets a specific class of derivatives tied to broad-based security indexes structured in a perpetual format.
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The move reflects ongoing efforts by the CFTC to clarify the regulatory treatment of newer contract structures in the derivatives marketplace. Perpetual futures, which lack a fixed expiration date, have grown in prominence particularly in digital asset markets, and the agency's guidance addresses how existing products can be transitioned to conform to a true perpetual structure.
DCMs operating under CFTC oversight are required to comply with core principles governing contract design and market integrity. The no-action relief provides a pathway for exchanges to make structural changes to qualifying contracts without triggering immediate enforcement exposure during the transition period.
The full terms and conditions of the no-action relief, including any limitations on its scope, are contained in the letter itself. Continue reading at Press Releases.
