CFTC Approval Fuels Crypto Hype

CFTC Opens US Perpetual Market

The Commodity Futures Trading Commission (CFTC) approved KalshiEX’s BTCPERP on May 29, marking the first Bitcoin perpetual contract on a US-regulated exchange. This move represents the most significant crypto regulatory action since the Bitcoin ETF approval. The cash-settled contract will trade around the clock and uses a funding mechanism tied to spot prices.

Simultaneously, the CFTC cleared a path for a Coinbase affiliate to connect US customers to options and perpetuals globally through Deribit, its affiliated foreign board of trade. This no-action relief allows Coinbase Financial Markets to accept Bitcoin, Ethereum, and stablecoins as margin collateral for eligible customers.

CFTC Chair Michael Selig stated that the agency had taken “historic action to permit the listing of a true Bitcoin perpetual contract by a CFTC-registered exchange, charting a path for one of the most liquid segments of the crypto asset markets.”

The CFTC is establishing separate regulatory pathways for crypto perpetuals: one for domestic listings on CFTC-registered exchanges and another for offshore products treated as foreign futures under existing regulations.

Markets responded immediately. Coinbase shares gained 4% and Robinhood shares rose 11% on Friday following the approval. Meanwhile, Hyperliquid surged over 30% from its Thursday lows, reaching a new all-time high of $73.50. HYPE has outperformed Bitcoin by 270% this year and has become a leading cryptocurrency in the current market cycle.

While some debate exists regarding the impact of the CFTC news on Hyperliquid, given the potential for increased competition, the market’s reaction suggests that legal perpetuals in the US are beneficial for Hyperliquid.

Jamie Dimon Criticizes Brian Armstrong

JPMorgan CEO Jamie Dimon has criticized Coinbase CEO Brian Armstrong regarding the Clarity Act, vowing to oppose the crypto market structure bill. Dimon reportedly called Armstrong “full of shit.”

The disagreement centers on the stablecoin yield carve-out. Armstrong has been vocal about preserving the “bona fide activities” exception, which allows platforms to offer rewards on stablecoin balances. Dimon argues that any yield-equivalent reward constitutes deposit competition that threatens the banking system’s deposit base. The core issue is whether stablecoin issuers should be permitted to offer yield-bearing rewards similar to bank deposits.

The Senate reconvenes today after the Memorial Day recess. A floor vote on the Clarity Act is expected within 30 days, according to leadership. The bill passed committee on May 14 with bipartisan support, by a vote of 15-9. It now requires 60 votes—approximately six Democratic crossovers—to advance on the Senate floor.

Prediction markets currently give the Clarity Act a 56% chance of passing this year, although these odds could increase with progress after the recess.

US Seizes $1 Billion in Iranian Crypto

Treasury Secretary Scott Bessent announced that the US has seized approximately $1 billion worth of crypto from Iran, including Bitcoin, Ethereum, and Tether’s USDT.

The seizures are linked to Iran’s Hormuz Safe platform and related enforcement actions by the Office of Foreign Assets Control (OFAC), targeting Iranian entities using crypto to circumvent Western sanctions.

This represents the largest single crypto seizure from a hostile state actor since the Department of Justice seized 94,000 BTC from the Bitfinex hack in 2022. The move raises questions about the destination of the seized funds. The US government currently holds approximately 200,000 BTC in its Strategic Bitcoin Reserve (SBR), accumulated through criminal and civil forfeitures.

White House Crypto Advisor Patrick Witt stated in late April that a “major announcement” regarding the SBR was forthcoming “in the next few weeks.” Representative Begich’s American Reserves Modernization Act, which would direct the government to acquire 1 million BTC over five years using budget-neutral strategies, considers using seized assets as part of the accumulation mechanism.

Iranian state media described the seizures as “an act of financial warfare” and reported that Iran’s cyber units are “working to identify and neutralize” the enforcement infrastructure used.