A 24/7 exchange for U.S. power, natural gas and compute. Trade perpetual swaps and dated futures from a single account, with near-instant T+0 settlement.
Joined February 2024
- Tweets1.6K
- Following442
- Followers20.9K
- Likes3.2K
The biggest market structure bill since Dodd-Frank is six Senate votes away. This afternoon the White House put the entire cap table of American markets on one stage to push it.
@coinbase , @krakenfx , @RobinhoodApp , @Gemini , @Ripple . @Nasdaq , ICE, the @NYSE . The chairs of the SEC and the CFTC in the same room. That guest list is the tell: the CLARITY Act is a market structure bill wearing a crypto costume.
Status, precisely, because the headlines blur it: the House passed it 294 to 134 last July, with 78 Democrats. One ethics provision held it up all summer. The Senate left for recess without a vote and takes it back up in September, roughly six Democratic votes short of sixty. The stablecoin bill was signed a year ago; this is the harder half. Nothing has passed yet.
What the bill actually decides is an address. Digital commodities go to the CFTC. Securities-like tokens stay with the SEC. Customer funds get bankruptcy protection, developers get safe harbors, and a jurisdictional tug-of-war that spent a decade in courtrooms gets settled in statute.
Congress has run this play before. Grain futures, 1936. The CFTC itself, 1974. The swaps market, hundreds of trillions notional, handed over by Dodd-Frank in 2010. When a market grows up, it gets sent to the commodity regulator, because the CEA chassis is the most adaptable rulebook American finance owns: registered venues, clearinghouses, core principles, self-certification.
The part I find most interesting: the agency about to inherit the asset class that never closes is the same one currently asking the public 67 questions about 24/7 trading and perpetual contracts. Those two facts are one story. The rulebook for always-on markets is being written this year, in statute and in comment files at the same time.
The fair caution: six votes are real, and one Senate amendment sends the whole thing back to the House. Bills die in reconciliation every year.
New markets are born wherever they like. They mature at the CFTC.
ethereum:0xa0b86991c6218b36c1d19d4a2e9eb0ce3606eb48 ripple:native #Stablecoins #Trading
You still cannot trade compute on a regulated U.S. venue. Not one live contract. Offshore is a different story: H100 perpetuals have traded in Bermuda since early this year, settled to @OrnnExchange's index.
Bernstein said it plainly in July: crypto-style derivatives reached AI compute before the @CMEGroup Group did.
Onshore, CME targets October 5 for its @silicondata contracts. Last week, Bloomberg reported the CFTC sent a compute futures request for comment to the White House. A 30 to 60 day comment window follows. Launch is 46 days out. The questions reportedly on the table: benchmark reliability, settlement design, and liquidity.
When the regulator opens a fresh question file seven weeks before launch, the design is unsettled. Three pieces decide it:
1. The index. The same H100-hour has been quoted under $3 and over $7 on the same day, depending on where you ask. Cash settlement is only as strong as its reference. Quote panels are gameable; LIBOR settled that debate. Transaction-only prints run honest and thin, and thin benchmarks get pushed around. Silicon Data and Ornn chose opposite answers. Settlement pressure will grade both.
2. Storage. Compute is a flow. An idle GPU-hour at 2am is gone forever, like an unsold megawatt. No storage means no cash-and-carry, so nothing arbitrages the curve back to spot and the back end floats on expectation. The cost floor walks down to the power bill under the rack. Early power futures died on this exact terrain.
3. Tenor. Galaxy is delivering 133 MW to @CoreWeave on a 15-year agreement at a former mining campus. The listed contracts are monthly. Perps fix trading: one liquidity pool, no roll, funding pinned to spot. A lender underwriting a gigawatt campus still needs the 2031 point, and the published curve stops near 36 months.
The years building @SphinxProtocol has been an apprenticeship in these exact questions. My read: this market goes to whoever answers all three in one coherent design. The request for comment is the field admitting nobody has yet.
Two comment windows. The 24/7 and perpetuals RFC closes August 26. The compute RFC lands after White House review.
What comments would you leave?
#AI #Derivatives #MarketStructure #ComputeFutures #perpetualswap
AI is creating a new oil rush.
Except this time, the prize isn’t oil.
It’s land, gas, water and power.
Across the U.S., communities are pushing back on massive new data centers.
So AI infrastructure is moving somewhere with a very different problem:
West Texas has more energy than it knows what to do with.
For years, Permian natural gas has occasionally been constrained by limited takeaway capacity.
Now that same gas can become behind-the-meter electricity for 24/7 compute.
And the economics go far beyond power.
Permian landowners are monetizing:
→ Land leases
→ Natural gas access
→ Water
→ Sand and construction materials
→ Produced-water infrastructure
Three major landowners alone control roughly 1.4 million acres.
Texas Pacific Land Corporation (TPL) Land generated around $386M last year from surface materials, water and saltwater royalties.
LandBridge believes a single 1-GW data-center campus could generate tens of millions of dollars in annual free cash flow.
This is where the AI boom gets interesting.
Everyone is watching Nvidia.
But underneath every GPU is a much older commodity stack:
Land. Water. Natural gas. Electricity.
AI may be digital.
Its bottlenecks are becoming increasingly physical.
And that could make energy markets one of the most important second-order trades of the AI era.
Sphinx retweeted
The largest unhedged commodity position in America might be sitting inside AI datacenters.
Everyone argues about GPU depreciation. Fair. But flip the ledger over.
A GPU cloud signs a 2 to 5 year take-or-pay contract at a fixed hourly rate. Revenue: locked. Debt service: locked. CoreWeave alone carries roughly $1.2B in annual interest that comes due whether utilization is 95% or 50%.
Power? Floating. Repriced every hour, 8,760 times a year.
Fixed revenue on top of a floating fuel cost is a spark spread. Merchant generators learned to hedge that exposure decades ago, usually the hard way. Airlines hedge jet fuel. Utilities hedge gas.
Most GPU clouds run the same book with no hedging desk.
The lawyers see it too. Quinn Emanuel's client alert on AI datacenter financing lists unhedged energy cost differentials as a contagion risk that can spread through the whole financing stack.
I spent years in energy infrastructure before derivatives, and this is the part of the AI trade I can't stop staring at. The market cap conversation is about chips. The margin conversation should be about megawatts.
Honest question for the energy traders in my feed: who is actually hedging this today, and with what?
Last Wednesday, the biggest power grid in America admitted it's running out of room.
PJM keeps the lights on for 67 million people across 13 states. It added a "capacity advisory" to flag when electricity supply could get tight. Not because of a heat wave or a polar vortex. Just an ordinary Tuesday.
This time it's the data centers.
They pull power at a density the grid was never built for, and they don't ease off at night or on weekends. So power starts to trade like a commodity in short supply: lumpy, volatile, hard to plan around.
When something gets scarce and volatile, the people exposed to it need two things: a real price, and a way to hedge it.
Energy markets are about to find out if their tools can keep up.
What happens to power prices when compute sets the peak?
So last month CME and ICE both launched compute futures on a GPU-hour index.
GPU-hour won for a boring reason: it's the one unit both sides can count and neither can fudge. FLOPs and tokens have better physics. Both lost because they let one side cook the number.
Check out the extreme website makeover for @SphinxProtocol
The most exciting part of building Sphinx is getting to work on the bleeding edge of several different spaces at once.
Energy is being reshaped by compute. hashtag#AI and the data center buildout are adding electricity demand the grid hasn't had to plan for in decades. The energy transition is changing how and when power gets generated, while natural gas keeps firming the system underneath it. And financial infrastructure is moving toward real-time, on-chain settlement. Each of those is a major shift on its own. They're happening at the same time, and they all run through the same markets.
Sphinx is built for exactly that convergence: a 24/7 institutional exchange for U.S. power and natural gas, with perpetual swaps, dated futures, and near-instant T+0 settlement. hashtag#Energy risk runs around the clock, so the venue for trading it should too.
Our new site brings the full picture together in one place.
sphx.io
Sphinx retweeted
Just wrapped meetings with Senator Michael Bennet and Senator @Hickenlooper's office alongside @standwithcrypto and @fund_defi .
As a founder and developer, I shared what regulatory clarity would mean for builders in Colorado and made the case for keeping developer protections in place as the Clarity Act moves toward a floor vote.
Thank you to the Senator's staff for the time. 🇺🇸
