Theodore Gillibrand, son of Senator Kirsten Gillibrand (D-N.Y.), has secured $30 million in funding to launch American Perpetuals Exchange Corporation (APEC), a new derivatives exchange. The 22-year-old’s startup aims to list perpetual futures for equities and stock indices, focusing on a financial instrument that has gained significant traction among digital asset traders. Lux Capital led the fundraise, which valued the startup at $300 million, according to sources familiar with the matter.
APEC plans to offer perpetual futures, often called “perps,” which are futures contracts allowing traders to speculate on asset prices without direct ownership. Unlike traditional futures, these derivatives lack a fixed expiration date. Theodore Gillibrand confirmed the funding round in a statement, emphasizing a shift towards regulated, institutional American companies for these markets, moving away from offshore and unregulated foreign entities.
Perpetual futures have a long history of popularity on digital asset exchanges. Over the past year, these derivatives have become a prominent asset in the broader financial world. The decentralized exchange Hyperliquid, initially focused on perpetuals, stands as one of the most profitable protocols in crypto. Other startups specializing in these derivatives have also attracted substantial investments from venture capitalists.
The appeal of perpetual futures extends to their continuous trading availability. For instance, Hyperliquid and similar platforms facilitate 24/7 trading. This feature proved particularly useful during periods when traditional exchanges were closed, such as during the U.S.’s conflict with Iran, when speculators traded oil index perps on these protocols.
U.S. regulators have also shown favor towards these financial instruments. In May, Kalshi, a prediction market, became the first U.S. company to offer perpetual futures to its traders. This followed approval from the Commodity Futures Trading Commission (CFTC) to list contracts for Bitcoin. A CFTC official noted this as a “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.”
APEC’s strategy involves applying for a license from the Commodity Futures Trading Commission. The company’s presentation filed with the Securities and Exchange Commission indicates its intention to list perpetuals for equities and stock indices, specifically excluding cryptocurrencies.
The launch of APEC introduces a new player into the regulated derivatives market, focusing on a product type that has seen substantial growth in less regulated environments. The company’s success will depend on its ability to secure regulatory approvals and attract traders to its platform for equity and stock index perpetuals. The market will observe how APEC navigates the regulatory landscape and competes with established financial institutions.
Future developments will include the progress of APEC’s licensing application with the CFTC and its subsequent operational launch. The broader trend of perpetual futures gaining acceptance within regulated U.S. financial markets, particularly beyond cryptocurrencies, remains a key area to watch.