BitMEX co-founder Arthur Hayes was surprised by Coinbase’s defense of the legality of stock perpetual contracts in the U.S. Ten years ago, when BitMEX launched Bitcoin perpetual swaps in 2016, the reaction in Washington was unfriendly. Perpetual swaps allow traders to hold leveraged positions without a fixed expiration date and have since become a standard tool in crypto trading.
On November 11, six companies, including Coinbase, filed a brief with the court opposing the Capital Markets Coalition’s motion to ban equity perpetual contracts. The Coalition argues that such products should be classified as equity swaps, subject to stricter regulations, and claims that the U.S. Commodity Futures Trading Commission (CFTC) did not provide sufficient justification when approving them. The U.S. Securities and Exchange Commission also opposed the ban. The district judge denied the request for a preliminary injunction but found that the Association might be able to prove that the Commission had exceeded its authority. Experts warn that an adverse ruling could drive trading activity to offshore and decentralized platforms.
Cover image: Fixedsun/Wikimedia Commons (CC0)
Disclaimer
The content of this article is for reference only, investors should exercise independent judgment, invest with caution and at their own risk, this article does not provide or attempt to persuade viewers to trade or invest on the basis of the content of this article is for sharing purposes only, and should not be regarded as investment advice, and does not represent the Monsterblockhk viewpoints and positions, all information and views of the specific date of the judgment of the time-limited nature. In addition, if any content in this website involves virtual asset trading platforms that have not yet obtained a license to operate virtual asset trading platforms in Hong Kong, including but not limited to text introductions, pictures, promotions, events, etc., they are only available to users outside of the Hong Kong Special Administrative Region.
According to the Hong Kong Anti-Money Laundering and Counter-Terrorist Financing (Amendment) Ordinance 2022, after June 1, 2023, all centralized virtual asset trading platforms operating in Hong Kong or actively promoting their services to Hong Kong investors will be licensed and regulated by the SFC, and any related unlicensed activities will be a criminal offence. For more information and details of the legislation, users may refer to the SFC website.