Cboe wants to turn VIX into a never-ending trade
Cboe is studying the idea of perpetual futures tied to the VIX, according to Bloomberg, though no contract specifications or regulatory filings have been made public. Perpetual swaps, a format popularized in crypto that never expire and use funding payments to track a reference index, could offer a continuous way to trade implied S&P 500 volatility.
Why It Matters
If launched, perpetual VIX products would blend crypto-style derivatives with mainstream volatility markets and could change how traders hedge and speculate on market stress. The structure removes expiry-driven roll costs but raises new hedging and basis-risk questions because the VIX is an index rather than a tradable cash asset.
Key Facts
- Source reporting Cboe interest: Bloomberg (reported exploration of VIX perpetual futures; no specs or filing yet)
- Perpetual futures origin: Proposed by economist Robert Shiller in 1993; commercialized by the crypto industry
- What VIX measures: Expected 30-day volatility of the S&P 500 derived from option prices
- Existing VIX products: Futures, options, and exchange-traded products already trade on the VIX
- Perpetual swaps mechanism: Use a funding rate to anchor contract price to the reference index and have no expiry
Cboe Global Markets is exploring the possibility of perpetual futures contracts that reference the VIX, Bloomberg reported, though the exchange has not filed any formal paperwork or released contract details. The idea borrows from a derivatives format that has become common in cryptocurrency markets: perpetual swaps, which remain open indefinitely and rely on periodic funding payments to keep contract prices near the underlying index.
The VIX is a calculated measure of expected 30-day volatility for the S&P 500 derived from option prices, and it already supports a broad derivatives ecosystem including month-dated futures, options and exchange-traded products. Those traditional futures expire on set dates, forcing traders to roll positions forward — a process that can be costly and lead to performance drag. Perpetual contracts remove expiry and the explicit need to roll, potentially offering a more continuous exposure to implied volatility.
Proponents say perpetual VIX contracts would let market participants focus on directional views of volatility without dealing with expiry-related decay. Martin Lee of DWF Labs told CoinDesk he expects a wave of indexes and metrics to be “perpified.” Some crypto venues already list VIX-style perpetuals: Gate offers VIX/USDT perpetuals, albeit in a market with very low liquidity, and Hyperliquid recently listed futures tied to Volmex’s bitcoin implied volatility index.
But analysts and market makers caution that removing expiry does not eliminate hedging costs or basis risk. Because the VIX is a calculated index rather than a tradable spot asset, market makers cannot buy or sell the underlying cash instrument to hedge in the same way they might with bitcoin. Marex Solutions noted that funding mechanisms would need to anchor an index that cannot be acquired in cash, and that a perpetual format is a potential new volatility market but not necessarily a cheaper substitute for the convexity provided by options.
At this stage, Cboe’s exploration reflects a continuing convergence between traditional finance structures and innovations from crypto markets. Whether a perpetual VIX contract would attract meaningful liquidity, narrow spreads among existing VIX products, or introduce new market dynamics depends on contract design, hedging solutions and demand from institutional participants.