Key Takeaways
- • Pillar, Kalshi and Susquehanna Predictions announced the completion of a first-of-its-kind commercial tungsten price hedge executed through event contracts on Kalshi, protecting an Ohio-based metals distributor from price volatility.
- • The hedge is tied to the SMM CIF Rotterdam benchmark for ammonium paratungstate (APT), a market for which no listed futures contract has ever existed.
- • APT prices have risen more than 500% amid supply constraints, and jumped as much as 94% in six weeks this spring, according to the announcement.
- • Kalshi listed a contract settling on December 17, 2026; Susquehanna Predictions structured, priced and provided liquidity, and Kalshi does not take either side of trades.
- • Pillar, founded in 2023 and backed by Andreessen Horowitz, says it has processed more than $1 billion in risk for refiners, miners, scrap dealers and manufacturers.
Summary
Pillar, the AI-powered risk management platform, Kalshi, the derivatives exchange, and Susquehanna Predictions, a market maker and liquidity provider, announced the completion of a tungsten price hedge using event contracts on Kalshi, according to a Business Wire release. Pillar hedged tungsten exposure on behalf of an Ohio-based metals distributor, while Susquehanna Predictions helped structure and price the transaction and supplied the institutional-scale liquidity needed to execute it.
The release frames the transaction against a constrained market. Tungsten has the highest melting point of any element and is used in armor-piercing munitions, jet engines, carbide cutting tools and semiconductor manufacturing. Export restrictions and production constraints have tightened global availability, and the United States has no active domestic tungsten mine production. Expanded Defense Department procurement restrictions taking effect in 2027 will further narrow eligible sources for certain tungsten materials used in defense applications, according to the release.
According to the announcement, APT prices have risen more than 500% and jumped as much as 94% in six weeks this spring. Because tungsten has never had a listed futures market, companies exposed to its price have had limited hedging tools. Pillar translated the client's physical exposure into a hedging strategy, Kalshi listed a contract settling on December 17, 2026, referencing the SMM CIF Rotterdam APT benchmark, and Susquehanna Predictions helped price the market. The market trades on an open, public order book, with prices set by participants.
Pillar, founded in 2023 by former Barclays and Coinbase employees and backed by Andreessen Horowitz, says its platform converts client physical transactions into hedges and manages them from execution through accounting. Harsha Ramesh, CEO of Pillar, said the company aims to give American businesses financial tools to secure supply chains. Nick Volbi, Head of Institutional at Susquehanna Predictions, described the transaction as evidence that prediction markets can address real institutional needs. Nicolas Hull, Director of Business Development at Kalshi, said tungsten is the first of a longer list of risks the exchange intends to market.
The release frames the transaction against a constrained market. Tungsten has the highest melting point of any element and is used in armor-piercing munitions, jet engines, carbide cutting tools and semiconductor manufacturing. Export restrictions and production constraints have tightened global availability, and the United States has no active domestic tungsten mine production. Expanded Defense Department procurement restrictions taking effect in 2027 will further narrow eligible sources for certain tungsten materials used in defense applications, according to the release.
According to the announcement, APT prices have risen more than 500% and jumped as much as 94% in six weeks this spring. Because tungsten has never had a listed futures market, companies exposed to its price have had limited hedging tools. Pillar translated the client's physical exposure into a hedging strategy, Kalshi listed a contract settling on December 17, 2026, referencing the SMM CIF Rotterdam APT benchmark, and Susquehanna Predictions helped price the market. The market trades on an open, public order book, with prices set by participants.
Pillar, founded in 2023 by former Barclays and Coinbase employees and backed by Andreessen Horowitz, says its platform converts client physical transactions into hedges and manages them from execution through accounting. Harsha Ramesh, CEO of Pillar, said the company aims to give American businesses financial tools to secure supply chains. Nick Volbi, Head of Institutional at Susquehanna Predictions, described the transaction as evidence that prediction markets can address real institutional needs. Nicolas Hull, Director of Business Development at Kalshi, said tungsten is the first of a longer list of risks the exchange intends to market.
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