Kalshi is a United States-based financial exchange and prediction market that allows users to trade on the outcomes of future real-world events. The platform operates as a Designated Contract Market regulated by the Commodity Futures Trading Commission (CFTC) and offers "event contracts" as a distinct asset class for speculation and hedging.
Launched in 2021, Kalshi provides a platform where individuals and entities can buy and sell contracts tied to the resolution of specific, verifiable events across categories such as politics, finance, sports, and culture. The platform's core product, the event contract, is a type of commodity derivative structured as a swap whose payout is determined by a binary (Yes/No) outcome. This mechanism is designed to create a direct financial instrument for expressing a belief about a future event and to generate a real-time, market-driven probability of that event occurring. [1] [2]
Kalshi positions itself as a tool for both precise hedging against event-specific risks and for speculation. For example, instead of trading broader financial instruments that bundle multiple exposures, a user can trade a contract directly tied to a single outcome, such as a Federal Reserve interest rate decision or the passage of a specific piece of legislation. The platform gained significant market traction following a key legal victory in 2025 that affirmed its ability to list contracts on U.S. political elections, a decision that contributed to its rapid growth in the prediction market sector. In late 2025, the company initiated a strategic expansion into the cryptocurrency space, aiming to integrate its regulated market infrastructure with various blockchain ecosystems. [3] [1]
Kalshi was launched in 2021 as a regulated prediction market. In 2023, the company filed a lawsuit against its regulator, the Commodity Futures Trading Commission (CFTC), to challenge the agency's decision to block the listing of event contracts related to the outcomes of U.S. political elections. [3] [4]
The platform experienced a surge in activity around the 2024 U.S. elections. In September 2024, the CFTC filed an enforcement action against Kalshi, but a U.S. court ruled in the company's favor in October 2024, permitting it to offer political event contracts. This legal battle concluded in May 2025 when the CFTC filed a motion to drop its appeal, a move that Kalshi stated secured the future of election-based markets on its platform. [2] [5]
Following this regulatory clarification, Kalshi focused on expansion. In April 2025, it began accepting Bitcoin (BTC) deposits, and in May 2025, it added support for Solana (SOL). In June 2025, the company closed a $185 million Series C funding round at an approximate valuation of $2 billion. Strategic initiatives continued throughout the year, including the integration of the AI bot Grok in July 2025 and the hiring of crypto influencer John Wang as its first Head of Crypto in August 2025 to lead its on-chain expansion. In September 2025, Kalshi announced a partnership with the Solana and Base blockchains to launch a grant program for developers. [2] [6] [5]
Kalshi's platform is built around the concept of event contracts, which function as the core trading instrument. It also provides a range of features for account management, trading, and developer access. [7]
The primary product offered on the exchange is the event contract, which has several key characteristics:
This structure allows users to trade on isolated outcomes, which differs from traditional financial instruments like stocks that represent a bundle of various risks and factors. [8] [1]
The Kalshi exchange provides tools and features for a range of users, from individuals to institutional entities.
The platform also runs formal incentive programs, including a Market Maker Program and a Volume Incentive Program, to encourage liquidity and high-volume trading. [7] [1]
Kalshi offers a diverse range of markets, with some of the highest trading volumes concentrated in politics, sports, and finance. As of October 2025, active categories included:
These markets are supported by a central limit order book where prices are determined by user activity. [8]
In mid-2025, Kalshi began a strategic initiative to integrate its platform with the cryptocurrency and blockchain ecosystem. The stated goal is to embed Kalshi's markets into "every large crypto application and exchange" within 12 months. This strategy aims to attract crypto-native users and developers by leveraging the company's regulated infrastructure to create new financial primitives. [3]
Key components of this strategy include:
The company also plans to "verticalize" its user interface, tailoring it to the specific information flows and contexts of different market categories to improve the user experience for distinct communities like sports bettors or financial traders. [6] [4]
Kalshi operates as a federally regulated financial exchange under the oversight of the Commodity Futures Trading Commission (CFTC). Its event contracts are legally defined as commodity derivatives, not company-linked securities like stocks or bonds. This distinction is central to its compliance framework, as it means that standard insider trading rules related to corporate information are generally not applicable. Instead, trading is restricted for individuals who possess material nonpublic information about the event itself. [1]
A defining event in Kalshi's history was its legal conflict with the CFTC over the listing of contracts on U.S. political elections. In 2023, Kalshi filed a lawsuit against the agency after it moved to block these markets. In October 2024, a U.S. district court ruled in Kalshi's favor. The legal challenge concluded in May 2025 when the CFTC dropped its appeal. This victory was a pivotal moment for the company, as it provided regulatory clarity and allowed Kalshi to become a prominent venue for trading on political outcomes. According to John Wang, the ruling established that prediction markets "hold the same status as normal derivatives and stocks." [3] [2]
Kalshi's market share in the prediction market sector grew substantially from 3.3% in 2024 to 66% by the end of September 2025, overtaking its competitor Polymarket. This growth was largely attributed to a surge in trading volume on its U.S. NFL-related event contracts and the regulatory clarity achieved from its legal victory. [3] [6]
In June 2025, Kalshi announced it had closed a $185 million Series C funding round led by the venture capital firm Paradigm. The funding round reportedly brought the company's total valuation to approximately $2 billion. [2] [5]
Kalshi has established partnerships to expand the reach of its markets. A notable collaboration is with the fintech platform Robinhood, which allows Robinhood users to trade on the outcomes of professional and college football games through Kalshi's markets. In September 2025, the company also announced partnerships with the Solana and Base blockchain foundations to foster a developer ecosystem around its platform. [5] [6]