1/ GPU prices can move dramatically—but most AI companies still have no way to predict what their compute will cost next year. Compute futures are designed to change that. Here’s how a company running 50 H100s could hedge its annual GPU bill. 🧵 2/ Starting October 5, pending regulatory review, NYMEX plans to list futures tied to Silicon Data’s H100 and B200 rental indices: • GPU1: H100 • GPU2: B200 • 1 contract = 730 GPU-hours • Financially settled—no GPUs change hands 3/ Why 730 GPU-hours? It represents one GPU running for an average month. That makes hedge sizing intuitive: if you continuously rent 50 GPUs, you can hedge one month by buying 50 contracts. 4/ Consider a company renting 50 H100s at: Silicon Data H100 Index + $0.15/hour It needs the GPUs throughout 2027 but fears rental prices could rise sharply. To hedge the full year, it buys 50 contracts for each month: 600 contracts total. 5/ Using Silicon Data’s September 7 implied forward curve, the illustrative 2027 strip averages $2.26 per GPU-hour. The company effectively locks in: $2.26 forward price $0.15 provider basis = $2.41 per GPU-hour 6/ Now imagine two very different outcomes: • The H100 index rises to $3.20 • The H100 index falls to $1.80 Without a hedge, the annual compute bill differs by more than $330,000. With the hedge, the net annual cost is approximately $1.057M in either case. 7/ If prices fall, the company would have been better off without the hedge. That isn’t a flaw—it’s the trade. Hedging means giving up the possibility of a cheaper year in exchange for protection against a much more expensive one. 8/ The strategy also works in reverse. A compute buyer worried about rising prices buys futures. A neocloud or infrastructure provider worried about falling rental revenue sells futures. The same market can create budget certainty for buyers and bankable revenue for providers. 9/ Futures don’t eliminate every risk. Companies still need to manage: • Basis risk between their provider and the index • Hyperscaler vs. neocloud pricing differences • Daily variation margin • Initial margin • Bid-ask spreads and early-market liquidity 10/ Until now, companies could reserve physical capacity—or remain exposed to future prices. Compute futures introduce a third option: Rent from the provider you choose while managing the market price separately. Our step-by-step practitioner’s guide: This is an illustration of contract mechanics, not a recommendation to trade. Futures involve leverage and daily cash requirements. Contract terms remain subject to the CME rulebook and regulatory review.