Kalshi is preparing to file with the Commodity Futures Trading Commission for approval of a perpetual contract tied to West Texas Intermediate crude oil, a structure borrowed from crypto derivatives markets that could become the first regulated oil perpetual in the United States.
The proposal, first reported by Reuters, would eliminate the recurring rollover costs that traders face with traditional WTI futures by allowing positions to remain open indefinitely while margin requirements are met. Kalshi expects to file next week and is seeking five-day-per-week trading.
The company has not yet published contract specifications including its benchmark, funding mechanism, margin framework or liquidation rules, leaving those details to the regulatory review process.
Why perpetuals matter for oil
Traditional WTI futures expire on fixed dates. Traders who want longer-term exposure must close positions, accept settlement, or roll contracts into later maturities. That rollover carries costs, and the timing of expiry can create artificial pressure on pricing around settlement dates. For hedge funds and commodity trading advisors running large crude books, those rollover costs add up quickly and create tax complications at year-end.
A perpetual removes that cycle. The structure relies on periodic funding payments between long and short holders to keep the contract price anchored to the underlying asset. When the perpetual trades above the spot price, long holders pay shorts. When it trades below, shorts pay longs. This mechanism keeps the contract from drifting too far from the actual market price, without ever requiring a settlement date or delivery.
Crypto exchanges have used this design for years on Bitcoin and Ethereum contracts, and it has become the dominant trading structure on platforms like Binance and OKX. The perpetual futures market on crypto exchanges routinely handles more volume than traditional dated futures, largely because traders prefer the simplicity of never having to roll positions.
Bringing it into oil raises different challenges. Crude has physical delivery considerations, regional pricing differences, storage constraints, and an established futures term structure that does not exist for crypto. The prompt month, the contango, the backwardation curve, and the basis between WTI and Brent all convey information that a perpetual might obscure. The CFTC has signaled that perpetual designs may not suit every asset class, meaning the WTI product would need its own assessment even after the agency approved Kalshi’s Bitcoin perpetual in May.
Precedent and pushback
The CFTC approved Kalshi’s BTCPERP contract on May 29, establishing that perpetual futures could operate on a US-regulated exchange. That approval was narrow, however, and agency officials have noted that the features that make perpetuals work for crypto may not translate directly to commodities with physical delivery.
The main concern is price discovery. Traditional futures markets provide a term structure that reflects market expectations about future supply and demand. A perpetual contract, by design, collapses that term structure into a single instrument. For a commodity like oil, where storage costs and seasonal demand patterns matter, that simplification could come at a cost.
Bloomberg also reported that Kalshi is pushing for 24/7 trading access, a separate proposal that faces its own resistance. The CFTC has already rejected a request for around-the-clock energy futures, with industry participants arguing that trading during thin-volume overnight sessions could amplify volatility and create liquidity gaps. The combination of perpetual contracts and extended hours would represent a significant departure from how US energy derivatives have traditionally operated.
Oil markets are currently volatile enough to make the question urgent. Brent crude has traded above $95 in recent sessions amid US-Iran tensions and concerns over disruptions near the Strait of Hormuz. Diesel crack spreads have hit record levels above $100 per barrel. A product that gives traders continuous exposure without rollover costs could attract significant demand in that environment, but the same volatility that makes perpetuals attractive also makes them risky for inexperienced traders.
From prediction markets to perpetuals
Kalshi launched in 2018 as a prediction market, offering event contracts on politics, economics and weather. The company has expanded aggressively into derivatives since receiving CFTC approval as a designated contract market. Its BTCPERP launch in May was the first perpetual futures product offered on a regulated US exchange.
An oil perpetual would mark a bigger step. It would extend Kalshi’s derivatives business beyond crypto and into one of the world’s most actively traded commodity markets. The global oil futures market handles billions of dollars in daily volume, and a US-regulated perpetual could capture a meaningful share of that flow from offshore crypto platforms where similar products already trade.
ICE and OKX already offer Brent and WTI perpetual futures for crypto users on offshore platforms, but no regulated US venue currently lists one. Hyperliquid’s policy arm has also urged the CFTC to consider perpetual futures as a hedging instrument for commodities, arguing that the structure could serve commercial producers and refiners as well as speculative traders. If Kalshi’s filing succeeds, it could open the door for similar products on other commodities like natural gas, gold, and agricultural products.
The CFTC review process typically takes several months. A filing next week would put a decision in the first quarter of 2027 at the earliest, assuming no major objections during the public comment period. The agency’s track record with Kalshi suggests it is willing to engage seriously with novel derivatives structures, but the physical delivery complexities of oil make this a different proposition than Bitcoin. Traders will be watching closely to see whether the CFTC treats this as a natural extension of the BTCPERP approval or as a new category requiring additional safeguards.
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