Kalshi is reportedly readying the launch of a futures market tracking inflation metrics.
The company, known primarily for its prediction markets, is aiming to launch the new exchange-traded futures offering in December, Bloomberg News reported Friday (Oct. 23), citing sources familiar with the matter.
The contracts would track the Consumer Price Index (CPI) and the core gauge of inflation, which does not factor in food and energy costs, the sources said.
According to the report, Kalshi has teamed with Michael Ashton, a former Barclays trader nicknamed the “Inflation Guy,” to design the contracts and court big investment firms.
The contracts would be the only futures linked directly to CPI, Bloomberg added, saying this would give Kalshi a way to attract investors in the markets for interest-rate and bond futures now offered by CME and Intercontinental Exchange.
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The report noted that Kalshi is hoping to launch the product at a moment when trading desks are focusing on inflation as they try to get ahead of interest rate hikes.
“There’s no exchange that trades this and they want to be the inflation exchange,” said Ashton, now the managing principal of Enduring Investments.
A Kalshi spokesperson told Bloomberg the company is on CPI futures, but declined to offer more details on the effort.
“Inflation has been a big, hot issue right now for people in America, and there hasn’t been very good tools to predict what inflation is going to be,” Kalshi CEO Tarek Mansour told Bloomberg TV on Friday in response to questions about the company’s work on CPI futures. “So we’re getting into pricing inflation.”
Kalshi has been expanding beyond its sports prediction market roots for the last several months. A company executive told Reuters in July that Kalshi wants to expand into the derivatives space for things like metals, foreign exchange and energy markets and to compete with traditional exchange operators by offering perpetual futures.
The company in September received permission from the Commodity Futures Trading Commission (CFTC) to list precious metals-related perpetual futures on its platform, including those for gold and silver.
Kalshi has also teamed with BitGo to allow some Kalshi customers to use eligible cryptocurrencies to post collateral for leveraged perpetual futures trades.
The collaboration is designed to address the needs of investors who may not want to exit their bitcoin holdings or depend on stablecoins for their business operations, Kalshi Prime CEO Jeff Bandman told Bloomberg in an interview.
