CME Sues CFTC Over Perpetuals

Kalshi Explores Potential IPO | Bernardo Brites of Trace Finance

Marco Manoppo & Karon Pangestu
June 19, 2026

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Good Morning

The biggest derivatives exchange in the world just sued its own regulator, and the fight is really about who gets to define a crypto product before it scales. CME wants perps reclassified as swaps, which would bury them in compliance and slow the platforms eating its retail futures lunch. The CFTC isn't backing down, calling it lawfare. Whatever the court decides becomes the template for every crypto derivative trying to get a US listing next.

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In Today's Email:

What Matters: CME Sues CFTC Over Perpetuals 👀
Founders Highlight: Bernardo Brites of Trace Finance 👨
Deal Flows: Kalshi Explores Potential IPO 💰️

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Narratives: Legacy Exchange Pushback

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WHAT MATTERS

CME Sues CFTC Over Perpetuals

State of play: CME Group sued the CFTC, accusing it of unilaterally letting crypto perpetual futures trade in the US without following Congress's swap regulation framework.

CME filed the suit Thursday in the US District Court for DC against the CFTC and Chair Michael Selig.
The CFTC approved perpetual futures for Kalshi and Coinbase last month, the first to trade in the US.
CME argues the new products compete directly with its retail futures business and cause it injury.
CME CEO Terrence Duffy called perps a "disaster waiting to happen" and said he'll step down in 2027.
The CFTC called the suit "lawfare" against its pro-innovation agenda and vowed to fight it.

Why it matters: First legal test of the CFTC's perpetual futures approval, deciding whether crypto-native products keep this path into US-regulated markets.

Our take: CME's swap argument has real legal teeth, not just sour grapes, but it's still an incumbent using classification rules to block a product it lost on. The skipped public comment period gives CME a genuine procedural hook.

For builders and investors: Court's read on "swap" sets precedent for crypto derivatives classification. A CME win could chill future approvals and push volume to platforms like Hyperliquid; Coinbase and Kalshi now carry litigation risk on a live product.

BUILDER-INVESTOR HIGHLIGHT

Bernardo Brites of Trace Finance

Intro: Bernardo Brites is the Co-Founder and CEO of Trace Finance, a cross border platform that allows companies to enable BRL access to millions of their users.

Previous background: Prior to Trace, Bernardo built a career across Brazilian and international crypto ventures.

He led partnerships at Decred and Transfero Swiss AG, securing exchange listings and VC relationships.
Then became CEO of Lasting Capital, Brazil's leading Bitcoin liquidity desk.
He also advised and wrote for Portal do Bitcoin and earlier co-founded Farmaliv.

The big idea: Bernardo through Trace aims to provide regulated, bank-grade local infrastructure to actually settle that value into local financial systems.

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INSIGHTS

Bitcoin Mining Economics Worsen

JPMorgan says bitcoin mining economics have deteriorated as BTC trades below its estimated production cost for a fifth straight month, squeezing miner profitability.

JPMorgan estimates bitcoin's production cost at $78,000, well above its current price near $62,500.
About 20% of bitcoin miners are now unprofitable, citing CoinShares' Q1 2026 mining report.
Public miners sold over 32,000 BTC in Q1 alone, already exceeding all of 2025's sales.
Mining difficulty fell 10% in mid-June, the year's second major drawdown as high-cost miners power down.
JPMorgan calls weak sentiment a possible bullish contrarian signal despite the cautious outlook.

DEAL FLOWS

Kalshi Explores Potential IPO

Deal flows soared this week - we saw $400M+ in deals 💼

Kalshi has held early, informal talks with investment banks about a potential IPO as its annualized revenue surpasses $2B.

Revenue has doubled from the $1B annualized run rate reported in March, per The Information.
Kalshi raised $1B in a Series F in May, hitting a $22B valuation led by Coatue.
Kalshi posted $16.81B in May volume, up from $14.81B in April, outpacing rival Polymarket.
Kentucky became the latest state to sue Kalshi and Polymarket over alleged unlicensed gambling operations.
Gaming industry groups urged Congress to ban sports-related prediction markets in upcoming crypto legislation.

Deal flows in the past week:

IO Trader, Undisclosed $ Pre-Seed Round
Probably, $9M Seed Round
Range, $8.3M Series A Round
El Dorado, $9M Series A Round
Trace Finance, $32M Series A Round
Flutterware, Undisclosed $ Series E Round
Re, Undisclosed $ Strategic Round
BitFi, $500,000 Unknown Round
Renaiss Protocol, $1.5M Unknown Round
EarnOS, $6M Unknown Round

QUICK BITES

CFTC enters settlement with former Celsius CEO.
Kalshi holds early IPO talks with investment banks.
CME Group sues CFTC over perpetual futures in US.
Ethereum Foundation’s Hsiao-Wei Wang steps down.
Morgan Stanley files amendments for ETH and SOL ETFs.
Tether winds down aUSDT stablecoin and Alloy platform.
Fidelity launches GENIUS-aligned money market fund for stablecoin issuers.

NOTEWORTHY READS & MEME

Pavel’s read on The Almanack of Hyperliquid.
Eli’s read on Neo-Cloud Landscape (June 2026).
Fiodar’s read on A Look Behind Ethena's Recent Partnerships.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.