Kalshi proposes oil contract with 10-year expiry

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Photo by Laura Brett/Getty ImagesKalshi Inc. has filed a proposal for an oil-linked futures contract that only expires every decade with the Commodity Futures Trading Commission, according to the company.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe CFTC has 45 days to approve or disallow the product, tied to the West Texas Intermediate benchmark. The contract is in the style of perpetual futures contracts, known as perps, which can’t be self-certified by exchanges like other event contracts, given the regulatory scrutiny surrounding them.This advertisement has not loaded yet, but your article continues below.The development is part of a broader effort to make real-world assets easier to trade. The Iran war has turbocharged demand from both institutional and individual speculators seeking to profit from volatile commodity prices. Oil markets in particular have seen dramatic price swings, with West Texas Intermediate futures trading across a roughly US$60 a barrel range since the start of the year.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againThe filing also reinforces Kalshi’s push into oil as competing efforts to expand trading in United States-regulated markets hit a major roadblock.The Chicago Mercantile Exchange on Friday announced that it was shelving plans to launch a round-the-clock oil contract following industry pushback. The bid was initially blocked by the CFTC and kicked off a months-long review of whether weekend trading is compatible with the physical oil market, which needs reliable benchmark pricing to sell cargoes.CME’s now-withdrawn contract would’ve traded nonstop, while remaining anchored to the expiration cycle of traditional oil markets. Kalshi’s product, by contrast, is aiming to trade 24 hours a day, five days a week — but only expires every 10 years. CME leadership has been vocal about its disapproval of perps, even suing the CFTC for allowing Kalshi to offer crypto-linked versions of the derivative earlier this year.Kalshi’s 24/5 structure was designed to address regulatory concerns highlighted by the trading community, Bloomberg reported earlier.Commodities markets on Kalshi were near US$400 million in trading volume as of early September, almost four times what crypto markets saw at the same point in their lifecycle, according to the prediction market.We apologize, but this video has failed to load.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.