A top Wall Street regulator is considering changes to a weekly report covering the position of traders just as prediction market exchanges and offshore venues start to offer more contracts in the oldest corner of the derivatives market.
The Commodity Futures Trading Commission is asking for public input on its Commitments of Traders reports, which is widely relied on by hedge funds and other traders to help craft their strategies.
“After significant outreach and communication with the agricultural community and commercial end users, the Commission is examining the current structure and publication of our COT Reports,” CFTC Chairman Michael Selig said in a statement Thursday.
That review comes after Kalshi Inc., a leading prediction markets platform, announced in mid-April the exchange would be offering a new commodities trading hub. But unlike industry stalwarts like CME Group Inc. and Intercontinental Exchange Inc. that support trading of grain, energy and numerous other derivatives, prediction markets don’t have to furnish information that is compiled into COT reports.
Kalshi agreed to limit its trading hours on new financial contracts tied to crops like corn to the same hours as traditional exchanges, Bloomberg reported earlier Thursday, following agriculture industry concerns about the products.
The CFTC said Thursday it is considering whether the one-of-a-kind data set should be published more frequently, and if doing so would risk revealing which companies or trading firms were taking large positions in a given market.
The agency also asked whether binary options, which can include the types of contracts traded on CFTC-licensed prediction markets, should be included in the reports.
