The introduction of perpetual futures to the US market has sparked significant interest, with trading volumes reaching $1 billion within a week of launch. This product, which does not expire and allows for periodic funding payments to maintain the contract's price, has become a staple in global crypto trading, with estimated annual volumes of $90 trillion. Despite this, large financial institutions are exercising caution, opting to study the product rather than invest heavily.
Instead, proprietary trading firms, market makers, and newer clearing firms are likely to be the first movers, as they have more freedom to test new venues and accept operational risk. The potential use cases for perpetual futures extend beyond speculation, as they could help traders manage weekend risk and provide a source of price discovery.
However, regulatory questions and competitive disputes are emerging, and the largest banks are unlikely to lead the charge until the rules, liquidity, and infrastructure are more established.