From FTX to TradFi: Brett Harrison Launches Perpetual Futures Exchange, Citing Crypto Leverage Risks

In a significant development for the broader financial landscape, former FTX US President Brett Harrison is set to launch a new perpetual futures exchange, purposefully distancing itself from the volatile and often unregulated world of crypto assets. This move, coming nearly two years after the dramatic collapse of FTX, signals a potential shift in how digital-first financial innovation is pursued, with Harrison explicitly citing “avoiding crypto risks” as a core tenet. His latest public comments further underscore a critical assessment of crypto’s inherent dangers, particularly the pervasive issue of excessive leverage trading.

A Post-FTX Pivot: From Crypto’s Wild West to Regulated TradFi

Brett Harrison, a figure who once stood at the helm of FTX’s US operations, is now channeling his expertise into a venture focused squarely on traditional financial assets. His new platform aims to offer perpetual futures for conventional markets, employing the kind of digital infrastructure and efficiency often associated with crypto exchanges, but under a robust regulatory framework. This strategic pivot is more than just a business decision; it’s a philosophical statement on the evolution of digital finance.

• Focus on Traditional Assets: The exchange will list perpetual futures contracts based on established financial instruments, bypassing the speculative volatility of unbacked cryptocurrencies.
• Regulatory Compliance: A core pillar of the new platform, emphasizing adherence to existing financial regulations to ensure investor protection and market integrity.
• Technological Edge: Leveraging advanced trading technology and high-performance infrastructure, akin to what powered leading crypto derivatives exchanges, but applied to traditional markets.
• Lessons from the Past: Harrison’s experience with FTX’s downfall undoubtedly informs this direction, with a clear intent to mitigate systemic risks that plagued the crypto sector.

The Peril of Crypto Leverage: A “Major Problem”

Harrison has been outspoken about the dangers within the cryptocurrency market, specifically labeling leverage trading as a “major problem.” This criticism is particularly potent given his background at a firm that heavily facilitated leveraged derivatives. His observations suggest a mature reflection on the industry’s pitfalls and and the need for more responsible financial practices.

Excessive leverage, while amplifying potential gains, dramatically magnifies losses, leading to cascading liquidations that can destabilize entire markets. The FTX collapse, for instance, highlighted how interconnected leverage and opaque balance sheets could trigger catastrophic events, wiping out billions in investor capital. Harrison’s current stance suggests a recognition that for digital asset markets to truly mature and attract broader institutional adoption, such systemic risks must be rigorously addressed, ideally through more stringent regulation or self-imposed discipline.

Bridging TradFi and Digital Innovation

This move by a prominent crypto industry veteran into traditional finance, while retaining a digital-first approach, could signal a significant trend. It suggests that the innovative spirit of crypto—its efficiency, speed, and 24/7 nature—can be decoupled from its often-problematic underlying assets. By applying these technological advantages to regulated traditional instruments, Harrison’s venture seeks to build a more secure and sustainable model for future financial markets.

The potential implications are broad:

• Increased Institutional Comfort: A regulated digital platform for traditional assets may appeal to institutional investors wary of crypto’s regulatory ambiguities.
• Proof of Concept for Digital Efficiency: Demonstrates that the operational efficiencies of crypto exchanges can be valuable in traditional finance without the associated asset risks.
• Talent Migration: Could inspire other disillusioned crypto professionals to apply their skills in more regulated, less volatile environments.
• Evolving Market Structure: Suggests a future where the line between “traditional” and “digital” finance blurs, with the best of both worlds converging.

Industry Reactions and Future Outlook

The crypto community’s reaction to Harrison’s pivot has been mixed. Some view it as a betrayal or an admission of crypto’s inherent flaws, while others see it as a pragmatic evolution—a recognition that robust regulation and risk management are essential for any financial market, digital or otherwise, to achieve mainstream acceptance. His departure from the core crypto space, specifically to avoid its perceived risks, provides a sobering perspective on the challenges that remain for the industry to overcome if it truly wishes to grow beyond its speculative roots.

As November 2025 begins, Harrison’s new endeavor serves as a stark reminder of the ongoing debate between innovation and stability, and the critical need for financial products that prioritize investor protection. Its success or failure could significantly influence future approaches to digitally-driven financial services, both within and outside the cryptocurrency ecosystem.

Conclusion

Brett Harrison’s launch of a traditional asset-focused perpetual futures exchange, alongside his pointed criticisms of crypto leverage, marks a noteworthy moment in the post-FTX era. His strategic shift underscores a growing sentiment within certain financial circles that while digital innovation is paramount, it must be paired with stringent risk management and regulatory oversight. This move, driven by the desire to “avoid crypto risks,” provides a compelling, if somewhat cautionary, commentary on the maturity and future direction of the broader digital finance landscape.