Financializing AI Compute: VC-backed Startups Build GPU Futures Markets Awaiting Regulatory Approval
Top VCs like Thrive and a16z are backing startups such as Ornn and Silicon Data to create GPU compute trading markets, aiming to provide hedging tools for AI infrastructure despite standardization and regulatory challenges.
According to Newcomer, several startups including Ornn, Silicon Data, Architect, and Liquid Compute are attempting to financialize AI compute (GPU usage) by establishing standardized pricing and futures trading mechanisms similar to commodities. This trend is supported by funding from top venture capital firms such as Thrive Capital, General Catalyst, a16z, and FirstMark Capital.
Ornn is currently in talks for a funding round with a valuation of around $1 billion, with Thrive and General Catalyst expected to participate; the company previously raised a $33 million seed round led by a16z crypto. Silicon Data has launched an hourly GPU rental price index based on data from approximately 100 sources and completed a $30.5 million Series A in August from Valor Equity Partners and Atreides Management’s joint AI fund. Brett Harrison, former president of FTX US, operates the derivatives exchange Architect, which raised $35 million last December to launch compute futures.
Traditional exchanges like CME Group and Intercontinental Exchange (ICE) also plan to list compute futures tied to Silicon Data’s and Ornn’s indexes, respectively, on the New York Mercantile Exchange. However, these markets have not yet received regulatory approval from the US Commodity Futures Trading Commission (CFTC). The CFTC has issued a public request for comment on compute futures, questioning whether compute is sufficiently standardized, interchangeable, and liquid to support a futures market.
Unlike traditional commodities such as metals, GPUs depreciate rapidly as new chips enter the market, complicating their financialization. Additionally, the demand driven by current compute shortages may be transient, adding uncertainty to the market. Despite these challenges, proponents argue that a standardized price discovery mechanism for compute could help data center operators (neoclouds) manage risk and lower financing costs.