Crypto Lumber Contracts Fail to Deliver
The price of lumber has taken a hit since crypto exchanges listed lumber contracts for trading. According to Protos, the USD price of lumber has fallen by 34.9% since FTX launched its lumber future on May 6, 2021.
In early 2021, during the COVID housing boom, lumber prices were soaring due to high demand and limited supply. The price had reached a peak in May 2021 with a seasonally-adjusted index of 455.4, compared to 296.4 in July 2026, as reported by the Bureau of Labor Statistics.
The introduction of blockchain-based lumber contracts was seen as an innovative way to tokenize and trade commodities. However, the market has not been kind to these new products. Protos reported that FTX saw around $23 million in lumber trading during its first several days, but this enthusiasm did not translate into long-term success.
The CME also changed its futures contract in August 2022 with a sunset period that ended in May 2023. The legacy 'Random Length Lumber' future covered 110,000 board feet and sourced delivery from western mills. In contrast, the new contract now covers 27,500 board feet, delivers to Chicago, and began trading on August 8, 2022.