The Perpetual Futures Debate: A Misguided Focus on Systemic Risk
The introduction of perpetual futures to regulated markets has sparked concerns about systemic risk, with critics warning that these high-leverage instruments could destabilize the market. However, this critique is misguided, as the risk is not inherent to the perpetual futures contract itself, but rather a result of the venue's design, including leverage limits, margin rules, and default handlin…