Former SEC and CFTC Officials Urge Regulatory Easing to Attract Crypto Perpetual Futures Back Onshore

The U.S. Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) are accelerating rulemaking for the $2.5 trillion industry amid a summer recess stalemate on crypto market structure legislation. The two agencies are advancing multiple crypto-related initiatives, including revisiting definitions of derivatives such as swaps and perpetual futures, and rewriting the SEC's crypto custody rules. A bipartisan group consisting of former CFTC Chair Chris Giancarlo, former CFTC Commissioners Brian Quintenz and Sharon Brown-Hruska, former SEC Commissioner Steven Wallman, and former SEC Chief Economist Chester Spatt said in a comment letter sponsored by Kalshi that similar risks should receive similar regulatory treatment, and overlapping rules should not pile on additional compliance costs. Giancarlo said that if federal regulation is calibrated to actual risk rather than maximum burden, liquidity will flow back to the U.S., and each year of waiting makes attracting liquidity back more difficult. Kalshi estimates that offshore perpetual futures trading volume will exceed $90 trillion in 2025, up from about $28 trillion two years ago. Additionally, the SEC last week submitted its plan to rewrite custody rules for investment advisers and investment companies to the White House Office of Information and Regulatory Affairs for review, and its "Reg Crypto" proposal has officially entered the Federal Register, with a public comment period running through October 20.