The Commodity Futures Trading Commission and the Securities and Exchange Commission opened a joint request for public comment on June 18, asking for industry input on how to define swaps, security-based swaps, mixed swaps, and novel products like event contracts. The move comes weeks after the CFTC approved KalshiEX's BTCPERP contract — a cash-settled perpetual that regulators treated as a futures product, exposing the gaps in existing legal categories.
What the joint request covers
The request focuses on product definitions under Title VII of the Dodd-Frank Act, which split swaps and security-based swaps between the two agencies. The practical problem: how do those legal categories apply to products that trade continuously, settle in cash, reference crypto prices, or look like prediction-market exposure? The CFTC and SEC are specifically asking about event contracts, innovative product structures, exclusions from the swap definition, mixed swaps, futures treatment, and alternative compliance approaches. They also want comment on whether a cash-settled perpetual contract referencing an equity security could be treated as a security future.
The public comment period will stay open for 60 days after the request is published in the Federal Register. That gives market participants and exchanges a tight window to weigh in.
The Kalshi BTCPERP precedent
On May 29 the CFTC approved KalshiEX's BTCPERP contract as a futures contract referencing the spot price of Bitcoin. The product is cash-settled, trades in units of one ten-thousandth of one Bitcoin, has no fixed expiration, marks positions to market continuously, and uses funding payments to keep the price in line with the reference. To a trader it looks like a standard crypto perpetual — but the CFTC said it's a future. That classification isn't just semantic; it determines which agency oversees it and which rules apply.
The Kalshi approval is the concrete case that made the definitional question urgent. If a product behaves like a perpetual but lives under futures rules, what about the next hybrid that blends features from both markets?
Harmonization efforts and lingering questions
In March the SEC and CFTC signed a harmonization memorandum committing to coordinate on product definitions, crypto assets, emerging technologies, alternative compliance, data sharing, and cross-market oversight. That memo preserved each agency's existing statutory authority. The June 18 request is the first major public output from that agreement.
The timing isn't accidental. With the Kalshi approval on the books and more crypto derivatives in the pipeline, both agencies need a clearer map before the next borderline product lands on a desk. The request asks about alternative compliance approaches — a signal that the regulators are open to flexible frameworks, though the details remain undefined.
The comment period is the next concrete milestone. Once it closes, the CFTC and SEC will have to decide whether existing definitions need a rewrite or just a joint interpretation. The industry's answers will shape how the next generation of crypto products gets regulated — and which agency gets to call the shots.
