On April 21, 2025, the Commodity Futures Trading Commission (CFTC) Divisions of Market Oversight, Clearing and Risk, and Market Participants issued two Requests for Comment (RFCs) on 24/7 trading and clearing of derivatives (24/7 RFC)1 and trading and clearing of perpetual style derivatives (Perpetual Derivatives RFC).2 Notably, 24/7 trading and perpetual derivatives are features most commonly seen in certain global markets for digital assets, including cryptocurrencies. While these features are predominantly designed for the unique characteristics of markets in digital assets, the focus of the CFTC’s RFCs is broader, requesting comments about potential use cases, challenges, opportunities and risks for implementation of 24/7 trading and clearing and perpetual derivatives contracts across all asset classes of derivatives. The deadline for submitting comments to the RFCs is May 21, 2025.
The 24/7 RFC seeks feedback on potential issues related to a designated contract market (DCM) or swap execution facility (SEF) electing to provide trading services on a 24/7 basis, which would mean trading and associated clearing is active for a vast majority of weekend and holiday hours. Specifically, the CFTC requests comments to help it better understand how DCMs and SEFs would maintain (i) the integrity of trading platforms without scheduled maintenance hours, and (ii) market surveillance for abusive trading practices. In addition, the CFTC raises questions related to how derivatives clearing organizations (DCOs) would source collateral and cover shifts in market liquidity during weekend trading. The 24/7 RFC also seeks comments on how margin would be collected over weekends and holidays when market participants are unable to make deposits to their margin accounts, such as through the pre-funding of margin for positions that are held open over the course of a weekend. Further, the RFC raises the issue of potential auto-liquidation of positions when a counterparty is unable to meet a margin call during weekends or other periods of off-hours trading.
The Perpetual Derivatives RFC raises questions regarding the impact that perpetual derivatives may have on market functionality and integrity, risk management, customer protection, retail trading, and regulatory gaps, both in existing markets and for new products. By way of background, while the price of “traditional” derivatives contracts is benchmarked between the derivative and underlying spot instrument at or around the expiration of the contract, perpetual derivatives settle on an ongoing basis, often multiple times a day. These contracts are described as “perpetual,” because this benchmarking occurs on an ongoing basis, which reduces the need for ‘rolling’ a contract from one expiration to another. As perpetual derivatives have historically been used only for digital assets to allow traders to maintain leveraged positions indefinitely without settlement, the RFC includes several questions seeking to understand what material benefits these products may provide to existing markets, including whether these products provide useful risk management or arbitrage opportunities, as well as any unique risks these products may pose to specific asset classes of derivatives.
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1 The CFTC’s Request for Comment on Trading and Clearing Derivatives on a 24/7 Basis may be accessed at: https://www.cftc.gov/PressRoom/PressReleases/9068-25.
2 The CFTC’s Request for Comment on Trading and Clearing “Perpetual” Style Derivatives may be accessed at: https://www.cftc.gov/PressRoom/PressReleases/9069-25.
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