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WTI Crude Oil (WTIC)

WTIC tokens provide exposure to West Texas Intermediate (WTI) crude oil, the primary North American crude oil benchmark. Hold tokens long-term for price appreciation or use them for hedging - with zero carry cost.

Reference Price Calculation

The WTIC reference price is derived from NYMEX WTI Crude Oil futures contracts (ticker: CL).

Normal Trading Days

On most days, the reference price equals the CL1 settlement price:

Component Description
CL1 Front-month NYMEX WTI futures contract
Settlement Official daily settlement price from CME Group
Time Published after market close (2:30 PM ET) 
Reference Price = CL1 Settlement Price

Futures Expiry Handling

WTI futures contracts expire monthly. To avoid the extreme volatility that can occur near expiry (as seen in April 2020), WTIC uses a transitional pricing methodology:

Day Pricing Method Rationale
Normal days CL1 Standard front-month pricing
Penultimate day Average of CL1 and CL2 Begins transition to next contract
Final expiry day CL2 only Avoids expiry-day volatility

Example during March expiry:

  • March 18 (normal): Reference = CL1 (March contract)
  • March 19 (penultimate): Reference = (CL1 + CL2) / 2
  • March 20 (expiry): Reference = CL2 (April contract)
  • March 21 onwards: Reference = CL1 (now the April contract)

Token Units

Tokens = Barrels

WTIC tokens are denominated in barrels, matching standard crude oil trading:

  • 1 WTIC = 1 barrel of WTI crude oil
  • Priced in USD per barrel (same as NYMEX CL)
  • Reference price = CL1 settlement price

Custody Backing = MMBTU

The underlying Volumetric Energy Receipts (VERs) are denominated in MMBTU (energy content):

  • 1 barrel WTI = 5.8 MMBTU in custody
  • MMBTU allows different crude grades to back the same token
  • Enables future cross-commodity products (Brent, Dubai, natural gas)

Why WTI?

WTI was chosen as the initial Energy Substantiation benchmark because:

  • Most liquid — Highest traded volume of any commodity futures
  • Transparent pricing — Continuous price discovery on regulated exchange
  • Real infrastructure — Backed by physical storage and pipeline network at Cushing
  • Global recognition — Standard benchmark for North American crude

Fee Structure

  • Minting fee: 0.10% of USD amount when purchasing tokens
  • Burning fee: 0.25% of USD amount when exiting via cash settlement
  • Burning fee during expiry: 0.50% during first and last 2 days of CL futures expiry to discourage expiry arbitrage
  • No holding fees: Zero carry cost for holding tokens long-term