On August 19, 2026, the Commodity Futures Trading Commission (“CFTC” or the “Commission”) issued a Request for Comment on the Listing of Compute Derivatives Contracts (the “RFC”), published in the Federal Registrar on August 21, 2026. The RFC seeks public comments by October 20, 2026 on factors a designated contract market should consider when addressing Commodity Exchange Act (“CEA”) and CFTC regulatory requirements relevant to an emerging class of derivatives with compute as the underlier (“compute derivatives”). In the press release accompanying the RFC, Chairman Michael S. Selig declared that “America cannot win the AI race without a robust derivatives market for compute” and described the RFC as the CFTC’s first formal step toward developing a regulatory framework for compute derivatives, which are financial products tied to the cost of computing power that support the AI economy.

The Existing DCM Regulatory Framework

The framework for compute derivatives includes designated contract markets (“DCMs”), which are CFTC-regulated exchanges and self-regulatory organizations that must comply with the statutory Core Principles in the CEA and CFTC regulations thereunder. For example, under CEA Core Principle 3 (Contracts Not Readily Susceptible to Manipulation), a DCM may only list contracts whose settlement price is reliable, publicly available, timely, and derived from a cash market with sufficient liquidity. Under CEA Core Principle 4 (Prevention of Market Disruption), DCMs must maintain surveillance, compliance, and enforcement capabilities to prevent manipulation, price distortion, and disruptions of delivery or cash settlement.

The CFTC’s Innovation Agenda

The compute derivatives RFC comes amid a broader CFTC innovation agenda. On August 20, 2026, the Commission convened the inaugural meeting of its Innovation Advisory Committee (the “IAC”), a newly formed advisory committee, formed to guide the Commission on the impact of technological innovation across the financial, derivatives, and commodity markets. Chairman Selig, the IAC’s sponsor, addressed the role of artificial intelligence and compute in the derivatives markets and the need to examine the “new frontier of finance.” The IAC meeting indicates that the RFC is one component of a wider effort to embrace market innovations and extend the derivatives regulatory framework to emerging asset classes.

Compute Market Background

The RFC outlines several compute market background issues driving the need for CFTC regulatory examination, these factors include:

• Economic Scale. The RFC explains that compute has become a “multi-hundred-billion-dollar enterprise” and a “scarce, capital-intensive commodity,” noting that recent academic estimates place the gross compute service flow at approximately $430 billion to $1.3 trillion per year—roughly 1.4% to 4.0% of U.S. GDP.


• National AI Policy. The RFC expressly ties the inquiry to the White House’s July 2025 “America’s AI Action Plan,”¹ which identified improving the financial market for compute as a recommended policy action.


• Challenges in Current Market. The RFC further notes that compute pricing today is highly fragmented and opaque, occurring primarily in bilateral transactions that are not publicly reported. A regulated derivatives market could aggregate these disparate data points and reveal forward-looking prices, enabling market participants to hedge exposure to compute costs.


• Standardization Challenges. The CFTC notes in the RFC that compute may not yet exhibit certain characteristics (fungibility, standardization, and sufficient liquidity) that typically underlie commodity derivatives markets. This RFC seeks data to inform whether and how the market can develop these attributes.

Comments Requested on Various Compute Market Issues

The Commission issued a number of questions in the RFC, organized into four principal categories:

1. Compute Cash Markets. The Commission seeks data on the size, participants, liquidity, and pricing dynamics of the compute cash market. It asks commenters to address the availability (or lack thereof) of public price data, the proportion of transactions conducted at publicly disclosed versus undisclosed bilateral prices, and whether it is appropriate to permit a derivative settling to a price the Commission cannot independently observe or verify. It also explores fungibility, standardization, and potential effects of listed derivatives on the underlying cash market.


2. Market Oversight and Susceptibility to Manipulation. These questions focus on the features a cash-settled compute derivative must demonstrate to satisfy Core Principle 3 and Core Principle 4. The CFTC seeks input on protections against a compute capacity provider manipulating a settlement index, the adequacy of existing reference-price series, surveillance capabilities needed, and whether information-sharing agreements between DCMs and compute providers are feasible and necessary.


3. Customer Protection of Market Participants. The RFC asks about heightened anti-money laundering and know your customers concerns for intermediaries, appropriate disclosures for a contract settling against a “geopolitically sensitive commodity,” unique protections for retail participants, and whether particular trader conduct patterns in compute markets warrant Commission action.


4. Perpetual Compute Futures. Lastly, the Commission inquires whether perpetual compute futures (contracts without a fixed expiration date) offer advantages over traditional fixed-date futures, whether they provide risk-management features unavailable through existing products, and what unique risks and additional safeguards they may require.

The Commission emphasized that it “particularly encourages commenters to provide empirical and data-driven input” and invites comment on all aspects of compute markets, including matters not expressly addressed in the RFC.

Key Takeaways

• The CFTC’s compute derivatives RFC marks the first time the Commission has formally signaled intent to develop a regulatory pathway for derivatives tied to AI computing power.


• No new rules or obligations will result directly from this comment request. However, the RFC’s wide scope (which spans market structure, manipulation safeguards, customer protection, and perpetual futures) indicates the Commission is laying the groundwork for future regulation as part of its innovation agenda.


• Companies purchasing or providing compute at scale should evaluate whether their current activities and contractual arrangements could be affected by future derivatives regulation and whether a futures market would provide beneficial hedging opportunities.


• Market participants who engage in this comment process will help define the terms on which a potentially transformative new asset class enters U.S. derivatives markets.


• Compute market participants should review the RFC and consider participation in the comment process, either directly or through relevant industry groups.

If you have questions about this client update or the CFTC’s Request for Comment, please contact Michael Loesch or Ryan Norfolk.

---

¹The White House, Winning the Race: America’s AI Action Plan (July 23, 2025), available at https://www.whitehouse.gov/wp-content/uploads/2025/07/Americas-AI-Action-Plan.pdf.

ABOUT BAKER BOTTS L.L.P.
Baker Botts is an international law firm whose lawyers practice throughout a network of offices around the globe. Based on our experience and knowledge of our clients' industries, we are recognized as a leading firm in the energy, technology and life sciences sectors. Since 1840, we have provided creative and effective legal solutions for our clients while demonstrating an unrelenting commitment to excellence. For more information, please visit bakerbotts.com.