Kalshi applies to launch gold and silver perpetual contracts

Kalshi applies to list perpetual contracts linked to gold and silver, and the crypto asset product line is further expanded.

Kalshi has submitted an application to the regulatory agency to list two types of perpetual futures contracts settled in US dollars and linked to gold and silver prices on a registered derivatives exchange. The move marks the expansion of its lineup of non-expiration contracts for qualified U.S. traders from the original 18 cryptocurrencies into the commodities sector.

Contract Details and Regulatory Process

GOLDPERP and SILVERPERP are expected to begin trading on September 9. According to Kalshi's regulatory filing with the U.S. Commodity Futures Trading Commission (CFTC) on September 9, the two contracts will be listed on the derivatives exchange in which it is registered. The company submitted these products pursuant to Section 40.2(a) of the CFTC Regulation, which allows designated contract markets to self-certify new products to meet the requirements of the Commodity Exchange Act and regulatory rules. Unlike the formal approval process, the self-certification process does not necessarily involve an active committee vote on every contract.

Under the proposed terms, each product will enable traders to be exposed to changes in the spot price of the relevant metal without having to deliver physical gold or silver. Both contracts are settled in U.S. dollars and will be open indefinitely. Kalshi identified Pyth Network as the price source for both products. Pyth Network publishes market data provided by trading companies, exchanges and financial institutions, which decentralized applications and trading platforms use to price assets.

Mechanism design: sustainable structure and capital rates

Unlike traditional futures, these contracts do not have a fixed expiration date. In order to keep the transaction price closely linked to its reference market price, the contract adopts a mechanism of regular payment of funding payments. Depending on how the contract trades against the spot benchmark, traders holding long positions may have to pay fees to traders holding short positions, or funds flow the other way around. This structure eliminates the need for traders to move positions from expiring contracts to subsequent contracts, thereby reducing the cost of moving positions for participants.

Kalshi pointed out that potential beneficial users include financial institutions, refineries, gold and silver dealers and companies that use the metal in production operations. Since both products are settled in cash, traders will not receive gold bars, silver coins or other physical metals, and Kalshi cannot be required for physical delivery when closing positions or settling.

All-weather Trading and Market Impact

According to the submitted specifications, GOLDPERP and SILVERPERP will enable uninterrupted trading 24 hours a day, 7 days a week. Kalshi's proposed schedule covers weekends and holidays, which is usually the time when major U.S. commodity futures markets are closed. This arrangement goes beyond the previous plan of only planning to trade 24/7 five days a week, allowing qualified customers to adjust positions during the closure of the standard U.S. metals trading market. Although liquidity and spreads may fluctuate during abnormal market hours, round-the-clock access provides greater flexibility.

For U.S. investors, these contracts provide regulated derivatives exposure without having to own shares of exchange-traded funds (ETFs) in gold, silver or the underlying metals. They also provide a different structure than listed options and forward futures because holders do not need to choose a monthly or quarterly expiration date.

Industry Background and Legal Disputes

Kalshi's entry into pegged metals contracts is closely followed by its rapid expansion in the field of cryptocurrency perpetual contracts. On September 4, the company added five categories of cryptocurrency perpetual contracts linked to BNB, Cardano, Worldcoin, Aave and Venice Token. Currently, Kalshi has listed 18 perpetual futures related to cryptocurrencies, including Bitcoin. Previously, the XRP perpetual contract has also been approved through the same self-certification rules, while the Bitcoin perpetual contract BTCPERP was approved by the CFTC after a formal review in May.

However, the legal status of perpetual futures in the United States remains controversial. On June 18, the Chicago Mercantile Exchange Group sued the CFTC in the U.S. District Court for the District of Colombia, challenging the regulator's decision to treat Kalshi's Bitcoin perpetual contract as a futures contract. CME maintains that BTCPERP should be regulated as a swap contract and claims that the CFTC's decision creates a competitive disadvantage for existing futures venues. In September, regulators sought to dismiss the case, arguing that CME had failed to prove the actual damage needed to establish standing. According to the CFTC, CME's own Bitcoin and Ethereum futures trading volumes exceeded May levels in both June and August, which does not support its claim that the Kalshi contract caused measurable competitive losses.

As Kalshi expands its perpetual contract product line to cover gold and silver, the legal debate over whether cryptocurrency perpetual contracts should be classified as futures or swaps continues, and the federal court has not yet ruled on the denial of the request or classification issue.