The highly popular crypto trading product, perpetual futures, has officially landed in the US, with trading volumes reaching $1 billion within a week of launch. Despite its popularity, traditional Wall Street banks are adopting a wait-and-see approach, citing concerns over liquidity, rules, and infrastructure.
Perpetual futures, which resemble standard futures contracts but do not expire, have become a core part of global crypto trading, with estimated annual volumes of $90 trillion. The Commodity Futures Trading Commission has cleared Kalshi and Coinbase to offer regulated perpetual futures in the US, but big banks are hesitant to commit due to stricter capital rules, client obligations, and reputational risk.
Instead, proprietary trading firms, market makers, and newer clearing firms are likely to be the first movers. 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, the market still faces challenges, including thin weekend liquidity, regulatory uncertainty, and competitive disputes between exchanges. As the market evolves, Wall Street's view is cautious, with the largest banks waiting for the rules, liquidity, and infrastructure to catch up before making a significant commitment.