U.S. approval of perpetual futures contracts could expose traders to unexpected tax and regulatory uncertainty if the products are ultimately determined to be swaps rather than futures, an issue that has received little public attention, according to CME Group Chairman and CEO Terry Duffy.
“There’s a consequence that nobody’s talking about,” Duffy said in an interview with CoinDesk. “There’s ambiguity right there, from a tax perspective, for all U.S. participants now.”
The comments come as CME continues its legal challenge against the Commodity Futures Trading Commission (CFTC) over the regulator’s approval of perpetual futures contracts in the U.S. Both sides await a federal court decision, and the outcome could significantly influence how the U.S. approaches the rapidly growing arena of perpetual futures. One consequence, according to Duffy, is how the Internal Revenue Service (IRS) ultimately taxes these contracts.
The dispute stems…
