Kalshi is entering a business Wall Street has largely kept to itself, and some of the industry's biggest names aren't thrilled. The Commodity Futures Trading Commission (CFTC) approved single-stock perpetual futures on November 3, opening the door for these contracts to trade on regulated U.S. exchanges. Kalshi jumped right in, making four stock-linked contracts available that same day.
The move gives Kalshi something quite different from the sports and political markets it's become known for. It also landed the company in another courtroom battle almost immediately, this time with established financial market players challenging the regulator's decision.
Kalshi Adds Four Familiar Companies to its Platform
Amgen, McDonald's, Qualcomm, and Costco were the first companies included in Kalshi's new offering. Rather than purchasing actual shares, traders can take positions based on movements in those companies' stock prices. The contracts also allow leverage, meaning a relatively small amount of capital can control a much larger position. Another major difference from traditional futures is that these contracts have no expiration date.
You can keep a position open as long as you meet the required margin, rather than having to close it or roll it over when a contract expires. Kalshi submitted its plans to regulators back in September. The review wrapped up November 2, leaving the exchange ready to introduce the contracts when the CFTC announced its decision Tuesday.
Stock Trading Without the Usual Clock
Anyone familiar with cryptocurrency markets has probably encountered perpetual futures. They've been popular outside the United States for some time, but applying the same structure to individual American stocks brings something new to regulated domestic exchanges.
Here's what traders should understand about the products:
- No expiration date: Contracts can remain open without a predetermined settlement deadline.
- Trading beyond market hours: Positions can be traded outside the usual stock exchange schedule.
- Leverage: Smaller upfront amounts can provide greater exposure, although losses can increase just as quickly.
- Price alignment: Recurring payments between traders help keep contract prices close to the underlying stock.
The Lawsuit Arrived Almost as Fast as the Launch
Pushback began quickly. The Capital Markets Alliance, an industry group that includes Cboe and Citadel Securities, filed a lawsuit in New York federal court on the day of the announcement. The group believes the contracts should instead be treated as security-based swaps, placing them under SEC authority. It also argues that the CFTC didn't follow the required administrative procedures when approving them.
Cboe CEO Craig Donohue questioned whether the products were receiving the appropriate regulatory protections. Kalshi executive Andy Ross pushed back, suggesting established exchanges were using litigation to protect their businesses from competition. Shares of Cboe, CME Group, and Intercontinental Exchange declined following the news. Senator Elizabeth Warren also said leveraged stock contracts could contribute to increased market volatility.
The Trade Handle Prediction Markets Take
Kalshi's legal calendar was already busy before Tuesday. The company continues fighting state regulators over sports event contracts, and now it has a separate dispute involving some of the biggest names in traditional finance. What's worth watching is whether this actually brings a new group of traders to Kalshi. Someone interested in predicting an election result isn't necessarily looking to trade leveraged contracts tied to Costco or McDonald's.
Still, the company clearly sees an opportunity beyond its existing markets. The CFTC has allowed these contracts to launch, but that doesn't mean the disagreement over their regulation is settled. We'll be watching both the court challenge and how much interest the new contracts attract. Those two developments should tell us considerably more about Kalshi's next chapter than the launch announcement alone.