US Compute Futures As Hedges Compute futures face the argument that if a future doesn’t track the exact costs hedgers incur, it will carry too much basis risk to form a viable market. This fundamentally misrepresents how hedges actually function in many major US markets. A hedge does not need to be perfect in order to be useful, let alone transformative, to its underlying commodity market. To be viable as a multi-billion dollar market, a hedging instrument needs to remove enough risk at scale to be worth its initial cost. If the correlation between a hedging instrument and the portfolio is ρ and the optimal hedge ratio is used, the fraction of variance eliminated by the hedge is ρ². A correlation of only 0.7 cuts variance in half. Cross-hedges built on loose relationships predominate in the real US economy. Airlines hedge jet fuel with crude. Bond desks hedge rate risk in credit with treasuries. Long-short equity portfolios hedge market beta with S&P 500 futures. At my former firms Jane Street and Citadel Securities, every trading desk was required to hedge portfolio factors with related instruments intraday and overnight to isolate alpha. Commodity markets are typically heterogeneous. Compute is not a unique underlying in this respect. An “H100 hour” could represent many different goods: SXM or PCIe, spot or reserved, hyperscaler or neocloud, US or Asia. Weigh this “problem” against the “solution” that compute buyers and sellers have today: nothing. Asset-backed loans on GPUs carry 40-50% haircuts because lenders can’t transfer the associated risks. The institutions financing the >$1T datacenter-linked debt sector regularly transact in other heterogeneous commodity markets. The success of US compute futures/options markets primarily depends on CFTC-regulated exchanges’ agility and competency at collaborating with index providers native to chip configurations, neocloud procurement, and timeseries interpolation on a continuous basis. Designing a futures contract that minimizes basis risk and maximizes liquidity formation is an antecedent requirement. Fulfilling the US government mandate to “accelerate the maturation of a healthy financial market for compute” is the main goal.