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Source/Full Story - GamingAmerica'
Kalshi and Polymarket announced perpetual futures products on the same day, racing to bring a product category that
has dominated offshore crypto derivatives markets into the U.S. regulatory framework.
On April 13, Kalshi CEO Tarek Mansour posted a cryptic teaser video to X with a single word: “Timeless.” A countdown
timer pointed to an April 27 launch event in New York.
The industry spent the following week speculating. Then, on April 21, Bloomberg confirmed what the rumor mill had been saying:
Kalshi is launching perpetual futures on crypto assets. Within hours, Polymarket announced it was doing the same thing.
Polymarket’s promotional video showed a sleek trading interface with leverage selectors ranging from 7x to 10x,
offering positions on cryptocurrencies, precious metals, and equities like Nvidia, available around the clock. Two of the largest
prediction market platforms in the world had pivoted on the same day into a product category that has generated hundreds of
billions of dollars in offshore monthly volume.
The question for anyone watching the American gambling and financial services landscape is the same: what exactly is a perp, and why does it matter?
What a Perpetual Future Actually Is
A standard futures contract is straightforward. Two parties agree today on a price for something to be delivered or settled at a
specific future date. A farmer locks in the price of a wheat crop before harvest. An airline hedges jet fuel costs for the coming quarter.
When the expiration date arrives, the contract settles, and everyone moves on.
Perpetual futures work differently. Instead of having a fixed expiration date, they stay open indefinitely. Traders can hold a leveraged
position for as long as they choose, provided they maintain enough collateral to support it. Rather than a single settlement at expiration,
there is a continuous fractional settlement process between the long and short sides of the trade, governed by a funding rate.
If more traders are long than short, longs pay a small periodic fee to shorts, and vice versa. That mechanism keeps the perpetual
contract’s price anchored to the underlying asset without requiring anyone to close and reopen their position when a contract expires.
Funding fees for these contracts are expected to be capped at around 11% APR, with settlement windows ranging from
5 minutes to 8 hours. The leverage on offer, up to 10x on Polymarket’s announced product, means a 1% move in the underlying
asset produces a 10% gain or loss on the trader’s collateral. A 10% adverse move at 10x leverage wipes the position out entirely.
That combination of no expiration, continuous settlement, and high leverage is precisely what made perps enormously popular in
offshore crypto markets. They became a workaround to traditional finance limitations in the crypto industry’s early years, and they
have since grown into the dominant trading instrument in crypto derivatives globally, with platforms like Hyperliquid processing
hundreds of billions in monthly volume entirely outside the U.S. regulatory framework.
Why They Have Been Offshore Until Now
The reason American traders have not had easy access to perpetual futures is not a lack of demand. It is a regulatory gap
that has existed since the advent of perps.
Standard futures contracts fall cleanly under the CFTC’s jurisdiction. Perpetual futures are structurally different enough that their
regulatory classification has never been formally settled in the United States. Without a clear legal pathway, exchanges operating under
U.S. licenses have stayed away, and volume has flowed to offshore venues where the rules are either absent or considerably more permissive.
That gap did not go unnoticed in Washington. In their September 2025 joint statement, SEC Chairman Paul Atkins and
CFTC Acting Chairman Caroline Pham identified perpetual contracts as a priority area for regulatory harmonization, noting that
jurisdictional and definitional constraints had limited their use in the U.S. and that the agencies could consider concurrent steps to
onshore perpetual contracts that meet investor and customer protection standards.
That regulatory green light, or at least regulatory green-ish light, is what unlocked the current moment. CFTC Chairman Michael Selig
said last month that the agency plans to formally authorize perpetuals in the U.S., which would accelerate the product’s mainstream
availability. Kalshi, which holds multiple CFTC licenses and secured approval for margin trading in March, has a clear regulatory pathway.
Polymarket’s situation is more complicated: it received CFTC approval to operate as a Designated Contract Market through its Polymarket
U.S. entity, but its announced product is launching on its international platform first, and the regulatory status for U.S. users remains unsettled.
Kalshi and Polymarket announced perpetual futures products on the same day, racing to bring a product category that
has dominated offshore crypto derivatives markets into the U.S. regulatory framework.
On April 13, Kalshi CEO Tarek Mansour posted a cryptic teaser video to X with a single word: “Timeless.” A countdown
timer pointed to an April 27 launch event in New York.
The industry spent the following week speculating. Then, on April 21, Bloomberg confirmed what the rumor mill had been saying:
Kalshi is launching perpetual futures on crypto assets. Within hours, Polymarket announced it was doing the same thing.
Polymarket’s promotional video showed a sleek trading interface with leverage selectors ranging from 7x to 10x,
offering positions on cryptocurrencies, precious metals, and equities like Nvidia, available around the clock. Two of the largest
prediction market platforms in the world had pivoted on the same day into a product category that has generated hundreds of
billions of dollars in offshore monthly volume.
The question for anyone watching the American gambling and financial services landscape is the same: what exactly is a perp, and why does it matter?
What a Perpetual Future Actually Is
A standard futures contract is straightforward. Two parties agree today on a price for something to be delivered or settled at a
specific future date. A farmer locks in the price of a wheat crop before harvest. An airline hedges jet fuel costs for the coming quarter.
When the expiration date arrives, the contract settles, and everyone moves on.
Perpetual futures work differently. Instead of having a fixed expiration date, they stay open indefinitely. Traders can hold a leveraged
position for as long as they choose, provided they maintain enough collateral to support it. Rather than a single settlement at expiration,
there is a continuous fractional settlement process between the long and short sides of the trade, governed by a funding rate.
If more traders are long than short, longs pay a small periodic fee to shorts, and vice versa. That mechanism keeps the perpetual
contract’s price anchored to the underlying asset without requiring anyone to close and reopen their position when a contract expires.
Funding fees for these contracts are expected to be capped at around 11% APR, with settlement windows ranging from
5 minutes to 8 hours. The leverage on offer, up to 10x on Polymarket’s announced product, means a 1% move in the underlying
asset produces a 10% gain or loss on the trader’s collateral. A 10% adverse move at 10x leverage wipes the position out entirely.
That combination of no expiration, continuous settlement, and high leverage is precisely what made perps enormously popular in
offshore crypto markets. They became a workaround to traditional finance limitations in the crypto industry’s early years, and they
have since grown into the dominant trading instrument in crypto derivatives globally, with platforms like Hyperliquid processing
hundreds of billions in monthly volume entirely outside the U.S. regulatory framework.
Why They Have Been Offshore Until Now
The reason American traders have not had easy access to perpetual futures is not a lack of demand. It is a regulatory gap
that has existed since the advent of perps.
Standard futures contracts fall cleanly under the CFTC’s jurisdiction. Perpetual futures are structurally different enough that their
regulatory classification has never been formally settled in the United States. Without a clear legal pathway, exchanges operating under
U.S. licenses have stayed away, and volume has flowed to offshore venues where the rules are either absent or considerably more permissive.
That gap did not go unnoticed in Washington. In their September 2025 joint statement, SEC Chairman Paul Atkins and
CFTC Acting Chairman Caroline Pham identified perpetual contracts as a priority area for regulatory harmonization, noting that
jurisdictional and definitional constraints had limited their use in the U.S. and that the agencies could consider concurrent steps to
onshore perpetual contracts that meet investor and customer protection standards.
That regulatory green light, or at least regulatory green-ish light, is what unlocked the current moment. CFTC Chairman Michael Selig
said last month that the agency plans to formally authorize perpetuals in the U.S., which would accelerate the product’s mainstream
availability. Kalshi, which holds multiple CFTC licenses and secured approval for margin trading in March, has a clear regulatory pathway.
Polymarket’s situation is more complicated: it received CFTC approval to operate as a Designated Contract Market through its Polymarket
U.S. entity, but its announced product is launching on its international platform first, and the regulatory status for U.S. users remains unsettled.