Former Regulators Warn SEC and CFTC Over Swap Rule Boundaries

Several former regulators, including former CFTC Chairman Chris Giancarlo, former CFTC Commissioners Brian Quintenz and Sharon Brown-Hruska, former SEC Commissioner Steven Wallman, and former SEC Chief Economist Chester Spatt, submitted a comment letter to the SEC and CFTC warning that liquidity could continue moving overseas if the regulatory boundaries for swaps, security-based swaps, and new products are drawn improperly. According to Foresight News, the letter argues that similar risks should receive similar regulation and that overlapping rules should not add extra compliance costs. Kalshi estimated that offshore perpetual contract trading exceeded 900 trillion dollars in 2025, up from 280 trillion dollars two years earlier. Giancarlo said the market is waiting for a reasonable set of U.S. rules. Kalshi hired a law firm to draft the letter, but the signatory officials were not paid and did not lead its content.