Industry Group Urges CFTC to Block Kalshi Oil Futures Contract

A group representing major US commodity exchanges has requested the Commodity Futures Trading Commission (CFTC) reject Kalshi’s proposed oil perpetual futures contract due to concerns about market integrity. The Commodity Markets Council (CMC), whose members include CME Group, submitted a letter raising questions about the risks associated with perpetual futures in commodity markets.

What Happened

The Commodity Markets Council (CMC), an industry group representing major US commodity exchanges, has urged the Commodity Futures Trading Commission (CFTC) to reject Kalshi’s proposed oil perpetual futures contract, according to Crypto News. The group expressed concerns regarding market integrity and the risks associated with perpetual futures in commodity markets. This follows Kalshi’s October 20 filing for a product named WTIPERP.

The proposed WTIPERP contract would allow traders to maintain exposure to West Texas Intermediate (WTI) crude oil prices without a fixed expiration date, tracking prices using a reference from two nearby futures contracts on the New York Mercantile Exchange. The CMC’s letter, reportedly citing contract details and filing dates corresponding to Kalshi’s proposal, did not explicitly name Kalshi, as detailed by Bloomberg Law.

Key Details

• The proposed WTIPERP contract would allow continuous exposure to WTI crude oil prices, unlike conventional futures with specified expiration dates, according to Kalshi’s filing.
• The contract’s pricing mechanism utilizes daily funding payments to align its trading price with a reference price tied to the existing futures market, with each cash-settled contract representing 100 barrels of oil, as reported by Crypto News.
• The CMC has questioned whether perpetual contracts can maintain the same connection to physical commodity markets as conventional futures, which typically converge toward physical market prices as delivery approaches, according to Bloomberg.
• Beyond Kalshi’s proposal, the CMC has also requested the CFTC coordinate with foreign regulators to restrict US retail traders’ access to offshore derivatives platforms via VPNs, citing concerns about manipulation and market oversight, as per The Crypto News.

Why It Matters

The opposition from established commodity exchanges and the CMC underscores a broader industry debate regarding the structure and oversight of novel derivatives products, especially perpetual futures. The concerns about market integrity and the connection of such contracts to physical commodity markets highlight regulatory challenges in adapting existing frameworks to new financial instruments. The CMC’s calls for restricting access to offshore platforms also indicate an industry-wide push for tighter regulation and oversight across the derivatives landscape, including decentralized markets, according to Finance Magnates.

Kalshi’s expansion into new derivatives offerings, such as the proposed oil contract and existing perpetual products for cryptocurrencies and precious metals, occurs while the company is engaged in separate legal disputes with US states. These disputes concern whether its event contracts fall under federal derivatives rules or state gambling laws. Federal courts have delivered varied rulings on this matter, with a case involving New Jersey now before the Supreme Court, as reported by Coinedition.

What’s Next

The proposed WTIPERP product remains subject to CFTC regulatory review, and the commission has not yet approved it, according to Crypto News. Meanwhile, the CFTC has submitted proposed event contract rules to the White House for review, which will address the classification of certain event contracts under federal derivatives law and the permissibility of products resembling casino gambling. Kalshi has until November 9 to respond to New Jersey’s request for Supreme Court review regarding the regulation of sports event contracts.

Originally reported by Crypto News·Published 23 Oct 2026, 06:32