The Misguided Debate Over Perpetual Futures and Systemic Risk
The introduction of perpetual futures to regulated markets has sparked concerns about systemic risk, driven by high-leverage, retail-led trading. However, the criticism is misplaced, as the risk is inherent to the venue's design, including leverage limits, margin rules, and default handling, rather than the contract itself. The real question is how a venue is built, with regulatory requirements p…