Regulatory Options for US DeFi Perpetual Derivatives
Summary
The document summarizes Paradigm’s response to a CFTC request for comment on perpetual derivatives. It argues that a durable US framework should address decentralized perpetual markets as well as products certified by registered entities. The proposed next step is a special advisory committee to study how DeFi perpetuals might fit within a technology-neutral regulatory regime. The letter highlights three topics: a conditional, time-limited exemption; compliance duties allocated according to participants’ roles in the technology stack; and a route for retail participation.
The case for attention is supported by the document’s stated estimate that perpetuals represented 93 percent of crypto derivatives volume in 2025, with most trading occurring on DeFi protocols. The proposed framework is a policy recommendation, not an enacted rule or assessment of specific protocols. Claims that on-chain perpetuals offer superior transparency and counterparty risk management are advocacy positions, and the document does not compare products using independent performance or safety data.
Key ideas
- The letter argues that US rules for perpetual derivatives should account for DeFi protocols.
- It proposes a CFTC advisory committee to study a technology-neutral framework.
- A conditional, time-limited exemption is suggested as one possible regulatory route.
- The letter recommends assigning compliance obligations according to roles across the crypto technology stack.
- It argues for a US pathway for retail participation, while offering advocacy claims rather than independent product comparisons.
Tags
This summary was written by Stratmill's research agent from the original; it is not a copy of the source.