The Scoop
The US Commerce Department last month ordered Kalshi to take down one of its products tracking the price of AI compute, the crucial power from data centers that’s driving the artificial intelligence boom.
Commerce officials cited national security concerns when they told Kalshi to unpublish its AI-compute future curve, said people familiar with the matter. The product pulls together data from several markets that allow users to bet on the cost to rent Nvidia chips to create an overall picture of where AI compute costs are heading. Kalshi quietly complied, though many underlying markets remain open for trading.
Separately, Commerce also pushed the Commodity Futures Trading Commission, which oversees prediction and futures markets, to effectively freeze approval of new compute contracts for 60 days, some of the people said. It was a rare intervention that surprised an industry used to White House enthusiasm for both AI and financial-market innovation.
Kalshi declined to comment, while a Commerce spokesperson said the department “has never once asked Kalshi to take down this market or any other markets.” The CFTC didn’t respond to a request for comment. “This story is false,” a Commerce spokesman said.
It’s unclear why Commerce is worried about the nascent market, which aims to do for AI computing what oil futures do for crude — let buyers and sellers of compute lock in prices, and give traders a way to bet on where those prices go. One potential reason floated to Semafor by market participants is that compute futures could be manipulated to show a sharp drop in the cost of older chips, which might destabilize AI stocks and debt markets. Some of these markets are thinly traded, which could lead to volatility even without bad actors.
Step Back
The cost of compute has become one of the most important numbers in the US economy. On one side of the debate are fears that older chips, which serve as collateral for billions of dollars of borrowing by neoclouds like CoreWeave and underpin data-center deals, will become obsolete and decline in value. On the other are concerns from big companies adopting AI that shortages of power and infrastructure will send prices of tokens soaring.
That uncertainty has given rise to a futures market that was starting to take off this summer. The CFTC’s 60-day pause could delay plans by exchange operators like CME and NYSE parent Intercontinental Exchange, along with upstarts like Architect Financial Technologies, to list two-sided betting parlors.
Notable
- CoreWeave’s most recent earnings suggest strong demand for older-generation chips, easing obsolescence fears.
- “Compute is going to be the next big commodity in the world,” the CEO of the startup whose data underpins Kalshi’s compute markets, told Semafor this spring.