Ondo Finance is making a regulatory push that could reshape how perpetual futures trade in the United States. The firm argues that existing securities laws already provide a legal framework to bring stock perpetuals onshore, and it's urging the Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) to formalize this path.
The distinction matters. Currently, retail and institutional traders access perpetual futures on US stocks through offshore venues like Binance and other crypto exchanges. These platforms operate in a regulatory gray zone, offering leverage, 24/7 trading, and minimal friction to US customers despite official restrictions. Ondo's proposal targets the opposite direction: creating a compliant, US-domiciled market for these derivatives.
Perpetual futures differ from standard options or term futures. They track spot prices indefinitely with no expiration date, funded through hourly funding rates between longs and shorts rather than premium payments. For US stocks, this means traders could hold leveraged positions on Apple, Tesla, or the S&P 500 indefinitely without rolling contracts. The appeal is obvious. Offshore platforms have captured billions in volume partly because they offer this frictionless experience.
Ondo's argument rests on existing law interpretation. The firm contends that securities regulations already permit registered exchanges and clearing houses to list perpetuals tied to individual stocks. The legal infrastructure exists in Rule 10b-5 frameworks, Reg FD, and established exchange registration requirements. What's missing is regulatory clarity and formal permission from the SEC and CFTC to proceed.
This timing aligns with a broader regulatory shift. The incoming Trump administration has signaled openness to crypto-friendly policy. The SEC's leadership may soon shift. Meanwhile, the CFTC has shown interest in accelerating derivatives onboarding. Japan, Europe, and other jurisdictions have already normalized stock perpetuals through licensed exchanges. The US delaying further amplifies competitive disadvantage.
Ondo itself operates in the tokenized securities space, managing billions in assets for regulated products like USDY (US Dollar Yield) and real-world asset products. The firm has credibility with regulators and institutional capital. Its push carries weight not just as a market participant but as a signal that serious infrastructure providers believe the legal path exists.
The regulatory response will determine market structure. If the SEC and CFTC formalize permissions, expect established players like Cboe, CME, or nasdaq-affiliated entities to launch US stock perpetuals within months. This would cannibalize offshore volume and trap liquidity in regulated venues. Retail traders would face higher compliance burdens but gain bankruptcy protection and institutional-grade risk management.
If regulators decline, offshore perpetuals remain the path of least resistance. Volume stays abroad, regulatory arbitrage persists, and US customers continue accessing uninsured venues.
The stakes extend beyond derivatives mechanics. Approving stock perpetuals signals a fundamental shift in how US regulators view leveraged crypto-native trading products. It acknowledges that perpetuals offer distinct advantages over traditional options and futures markets. It accepts that retail demand for these products is real and won't disappear through restriction alone.
Ondo's move is calculated. The firm isn't asking for new regulation. It's asking for formal recognition that existing rules permit what markets already demand. That's a harder case to deny.