Retail traders are piling into perpetual futures, a product only cleared for US trading in May despite consumer advocates labeling it “the most dangerous product in crypto.” Platforms such as Kalshi, Coinbase, and Singapore‑based Hyperliquid now offer the highly leveraged contracts, which trade 24/7 and allow large positions with minimal cash. Kalshi reported $1bn in volume within a week of launch, making it the firm’s fastest‑growing product.

Critics warn that the CFTC’s decision to classify crypto perps as futures rather than swaps eases margin rules and tax treatment, encouraging speculative, adrenaline‑fuelled trading. The head of the CFTC called the move a “watershed moment,” but Better Markets’ Benjamin Schiffrin said the regulator ignored the risks. CME Group has sued the CFTC, alleging chair Michael Selig undone post‑2008 safeguards.

Proponents argue perps provide valuable price discovery when traditional markets are closed, yet their continuous design can trigger cascading liquidations. After Donald Trump’s tariff threat on October 10, 1.5mn crypto traders were liquidated in 24 hours, and the global crypto market shed $1.2tn over six weeks.