Kalshi Aims to Expand Perpetual Futures Beyond Crypto

Prediction market Kalshi is seeking CFTC permission to offer perpetual futures on gold, foreign exchange and energy, a company executive told Reuters. The move would extend the model Kalshi launched for crypto in May into traditional asset classes.

Chief Risk Officer Udesh Jha said the CFTC has already approved crypto perpetuals. "The other asset classes that we're looking at are very much driven by the market, for instance, things like gold," Jha said. He added that Kalshi is in discussions with regulators about adding FX and energy contracts. Gold is coming up because it's retail friendly, Jha noted. The company's user base skews retail but also includes institutional participants.

Perpetual futures have no expiration date. Investors can hold positions indefinitely rather than rolling or closing contracts. The model is widely used in crypto, where perps account for the bulk of leveraged trading. Critics say these products are risky for retail investors who may not grasp their complexity and could face steep losses from small price moves.

CME Group, the Chicago derivatives exchange, has taken a vocal stance against perps. Outgoing CEO Terry Duffy in June called them a "disaster waiting to happen." CME later sued the CFTC, challenging its decision to let Kalshi and Coinbase list perpetual futures. The lawsuit argues the CFTC overstepped its authority.

Kalshi's total perpetual volumes have reached $16.1 billion since the products went live, Jha said. The company is also looking at perpetuals tied to broad-based indexes and individual stocks.

Separately, a federal judge this week denied Kalshi's request to block New York from applying state gambling laws to the platform. Kalshi had argued that the Commodity Exchange Act preempts state gambling rules. It appealed the decision. New York Governor Kathy Hochul and Attorney General Letitia James said in a statement that "Kalshi tried to ignore them. Yesterday, they lost in court." The state called the platform a gambling service and said it would continue to hold prediction markets accountable.

The CFTC approval process for new asset classes could take months. Gold perps would face additional scrutiny given the metal's role in retail speculation and potential for manipulation, traders said. CME's lawsuit adds a legal overhang. A ruling could come before the end of the year.