CME sues regulator to block PERP competition
CME Group's lawsuit against the CFTC over the approval of perpetual contracts (PERPs) is framed as a defensive legal strategy to protect its dominant US derivatives monopoly.
The argument
The speakers argued that CME is using 'lawfare' and technical arguments—classifying PERPs as swaps rather than futures—to prevent retail-friendly perpetual contracts from disrupting its market share. If CME succeeds, it could halt the domestic expansion of PERPs, whereas a CFTC victory would open the door to new competitive derivative products in the US.
The thesis, stress-tested
✓ What validates it
- ✓Court ruling on whether PERPs are legally classified as futures or swaps
- ✓Launch of domestic PERP products by competitors like Kalshi or Poimis
▸ Risks discussed
- ▸The court could rule against CME, validating the CFTC's approval of PERPs and introducing new competition
- ▸Reputational risk from aggressive litigation against its primary regulator
Hear it yourself
"I'm gonna increase the preferred dividend, which effectively dilutes the common shareholders indirectly because that's the first line of defense before kind of selling Bitcoin. You know, if you look at all the convert sales they've done in the past, that's not that different to, like, hey. I have Luna inflation. The only difference is, like, I'm doing it continuously on chain versus, like, I'm doing it discreetly via these, like, convert events and, like, the the paying up dividends on the other side. So let let's, like, sharpen this thing because I think when people hear this, I think what it implies is that MicroStrategy is inevitably going to collapse."
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