Monolith emerged from stealth this morning. The firm is developing an end-to-end onchain venue for US institutional commodity derivatives.
Its thesis targets two specific market issues: valuable assets sit idle because collateralizing them often takes far too long and risk moves continuously, yet markets have artificial closing windows.
Monolith wants to compress the collateralization process from weeks into hours and enable that capital to be hedged and traded continuously via perpetual futures. Energy is their first target market.
The venue is not live yet. The team behind it is opening a dialogue with additional energy market participants, asset owners, trading firms, and investors. Notably, the structure still depends on regulatory designations Monolith does not yet hold but is pursuing.
Introducing Monolith, the end-to-end US venue for onchain institutional commodity derivatives.
— Monolith (@MonolithFi) August 25, 2026
Tokenize & collateralize any eligible physical or digital asset and hedge it against 24/7 oil and gas futures.
This is the future being built at https://t.co/I2pyLotrco. pic.twitter.com/Hwvtps95I9
What Monolith Is Building
Monolith describes a single venue that handles the full lifecycle of a hedge. That lifecycle covers tokenization, collateralization, margin, tri-party clearing, hedging, and settlement. Today, each of those functions lives with a different counterparty. Custodians, insurers, valuation agents, banks, clearinghouses, and settlement systems all reconcile on separate timelines. As a result, an asset must travel through that entire chain before it can back a trade.
Monolith argues the delay is structural rather than incidental. Consequently, its answer is to coordinate those functions in real time on one platform. The firm says it is working with a tri-party clearing partner, though it has not yet named that partner publicly. That omission matters, because the clearing relationship also carries regulatory weight in this design.
The Idle Collateral Problem Is Real and Large
The underlying inefficiency is well documented outside crypto. The Asian Development Bank has put the global trade finance gap at roughly $2.5 trillion. Commodity trading adds its own friction on top of that number. An LNG or crude cargo can take days to weeks to clear ownership, insurance, financing, and settlement. During that window, the cargo represents genuine value that often cannot be efficiently financialized.
Monolith frames this as trapped working capital rather than a paperwork nuisance. Meanwhile, the tokenization market that would address it keeps growing. Tokenized real-world assets reached roughly $31 billion onchain by July 2026, according to rwa.xyz. That figure is up more than 400% since early 2025. However, treasuries and private credit still dominate that total, not physical commodities.
Tokenization and Perpetuals Do Different Jobs Here
The design combines two market-structure changes, and each solves a separate problem. Tokenization handles the record. It creates one shared, programmable representation of an asset or claim. That shared record makes ownership, custody, and financing facts easier to verify and transfer. Importantly, Monolith is explicit that tokenization does not create legal rights or remove underlying risk. It only makes sound legal arrangements easier to coordinate.
Perpetual futures then handle the hedge. These contracts carry no expiration date, so they trade continuously rather than within fixed sessions. As a result, holders avoid the cost and operational work of rolling positions between dated contracts. CME and ICE energy futures currently run roughly 22 to 23 hours a day, five days a week. Physical energy risk, in contrast, does not pause for a weekend.
Why Energy, and Why the Timing Fits
Energy is the largest commodity market, and the numbers back that claim. The World Federation of Exchanges recorded 12.49 billion commodity contracts traded in 2025, up 17.5% year over year. ICE reported record 2025 Brent volume at 1.5 million contracts a day, an 11% increase. CME’s WTI futures carry roughly 4 million contracts of open interest. Henry Hub natural gas open interest sits near 1.7 million contracts. Additionally, ICE traded 61.2 million TTF gas contracts in the first half of 2025 alone.
Two shocks sharpened the case this year. The Strait of Hormuz closed on March 4, 2026 following the escalation with Iran. Brent then rose about 65%, or $46 a barrel, by the end of March. The World Bank called it the largest oil market shock on record. Separately, AI datacenter power demand keeps pulling on gas markets. Global datacenter electricity consumption grew 17% in 2025, per the IEA, while AI-specific consumption jumped 50%.
The Regulatory Path Runs Through the CFTC
This is where Monolith faces its steepest climb. The venue would need designation as a designated contract market, or DCM. Its clearing organization would need separate registration as a derivatives clearing organization. A DCM must satisfy 23 statutory core principles under the Commodity Exchange Act. Neither designation is quick, and Monolith holds neither today.
The broader direction, however, has moved in its favor. The CFTC approved the first US-listed perpetual futures contract on May 29, 2026, a cash-settled bitcoin perpetual on KalshiEX. Alongside that approval, the agency issued a policy statement on future perpetual submissions. That statement carries an important limit. The approval covered digital commodities with deep, active, and continuous spot markets. For non-digital commodities, the CFTC asked filers to seek prior review instead of self-certifying.
Crude oil and natural gas fall squarely in that second bucket. Monolith would therefore file into a review process rather than certify its way to launch. Meanwhile, the agency’s Crypto Sprint has been rewriting the surrounding rules since August 2025. Chairman Michael Selig, sworn in on December 22, 2025, has kept tokenized collateral and onshoring perpetuals on the agenda.
Cutting Out the FCM Is the Boldest Piece
Monolith’s non-intermediated clearing model may prove harder to win than the perpetuals themselves. Under the proposal, eligible small and mid-sized firms would clear directly. They would not need a relationship with a futures commission merchant. High FCM margin requirements currently price many of those firms out of hedging entirely. Removing that layer would widen access considerably.
Regulators are actively studying the idea. CFTC staff requested public comment on direct clearing by retail participants, with comments closing January 19, 2026. Industry response was mixed. The FIA argued that FCMs supply essential customer protections, including AML checks, fund segregation, and sales-practice supervision. Monolith says its model would preserve risk-based margin, eligibility standards, position limits, and default management. Regulators have not yet ruled on whether that trade is acceptable.
What Is Still Unknown
Several things remain open, and they are the ones worth watching. Monolith has not named its clearing partner or disclosed its funding. It has not published collateral eligibility criteria, which determine what cargo actually qualifies. It has also not given a filing date or a target launch window. The firm says it will publish more detail on market design and its regulatory path.
The competitive backdrop is filling in quickly regardless. Onchain RWA perpetual volume rose from $11.8 billion in December 2025 to $31.0 billion in January 2026. Commodity perpetuals now account for more than 67% of activity on Hyperliquid’s HIP-3 markets. Those venues, though, operate outside the US regulatory perimeter. Monolith is betting that institutional energy hedgers will pay for the version that sits inside it.
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