Kalshi

At a Glance

• Regulated by the CFTC as a designated contract market (DCM) — the only federally licensed prediction market platform operating legally for US residents
• Founded 2021 by Kalshi Inc.; co-founders Tarek Mansour and Luana Lopes Lara previously worked at Goldman Sachs and MIT
• Fiat-only platform — no cryptocurrency deposits or withdrawals; ACH and wire transfers supported
• Markets span politics, economics, weather, sports, and science — with new event contracts added regularly based on user demand
• 4.7/5 rating — strong marks for regulatory clarity and market depth; deducted for limited fiat options and occasionally thin order books in niche markets
• Best suited to US-based traders who want legally protected, tax-reportable event contract positions

How Kalshi Works

Kalshi operates as a binary event contract exchange. Every market reduces to a single question with a yes or no outcome — "Will the Federal Reserve cut rates in September?" or "Will the US unemployment rate exceed 4.5% in Q3?" You buy YES shares if you believe the event will occur, or NO shares if you believe it won't.

Probability as price: Share prices run from $0.01 to $0.99, directly reflecting the market's implied probability. If YES shares trade at $0.62, the market collectively estimates a 62% chance the event resolves YES. You pay $0.62 per share and receive $1.00 if correct — a profit of $0.38. If you're wrong, the share expires worthless. This makes position sizing intuitive: buying 500 YES shares at $0.62 costs $310 and returns $500 if resolved in your favor, netting $190 before fees.

The order book: Unlike some prediction platforms that use automated market makers, Kalshi runs a central limit order book (CLOB). You place limit orders at the price you're willing to trade, and the exchange matches you with a counterparty. This structure rewards patience — aggressive market orders on thin books can slip meaningfully.

Resolution mechanism: Each contract specifies a resolution source in advance — Bureau of Labor Statistics data, official election results, National Weather Service figures, or similar authoritative third-party sources. Kalshi's compliance team verifies the outcome and settles the contract, typically within one to three business days of the event. Disputed resolutions are rare but handled through formal CFTC-supervised processes, which is a material advantage over unregulated alternatives.

Example market mechanics: During the 2024 US presidential election cycle, Kalshi ran "Will Donald Trump win the 2024 presidential election?" This market attracted hundreds of millions of dollars in notional volume, generating meaningful price discovery that was cited in mainstream financial media. Traders who bought YES shares at $0.45 in mid-October 2024 collected $1.00 per share at settlement — a $0.55 gain per share. Those who held NO shares to zero lost their entire stake. That asymmetry is the fundamental risk every participant must understand before placing a position.

Available Markets

Kalshi categorizes its markets into several primary verticals, with new event contracts appearing frequently. Market depth varies significantly by category.

Politics and elections: The deepest, most liquid markets on the platform. Congressional control, presidential approval ratings, Supreme Court decisions, and international elections all appear here. During active election cycles, bid-ask spreads on major markets compress to one or two cents — tight enough for meaningful position trading. Off-cycle, spreads widen and volume drops.

Economics and finance: Fed rate decisions, CPI prints, GDP growth, unemployment rates, and housing data. These markets often attract participants who hold corresponding positions in traditional financial instruments, using Kalshi contracts as hedges. "Will the Fed cut rates by 25bps at the November 2024 FOMC meeting?" routinely draws tens of thousands of contracts. Liquidity here is second only to politics.

Weather and science: Hurricane tracks, seasonal temperature anomalies, and whether specific scientific milestones will be reached by a given date. These markets are thinner and carry meaningful resolution ambiguity risk — contract language matters enormously. Read the resolution criteria before entering any weather position.

Sports: Kalshi offers sports event contracts covering major US leagues — NFL playoffs, NBA Finals, college football championships, and select international events. Liquidity is adequate for smaller positions but rarely matches dedicated sports-focused platforms. Spreads can be five cents or wider in early-season futures.

Technology and AI: An expanding category. Markets like "Will GPT-5 be released before [date]?" or "Will a specific AI benchmark be surpassed?" appeal to a technically literate user base. Resolution sources for these markets deserve scrutiny — "announced by OpenAI" is more subjective than "published by BLS."

Crypto prices: Yes, despite the platform accepting no cryptocurrency deposits, Kalshi offers event contracts on crypto price levels — "Will Bitcoin exceed $100,000 before year-end?" These markets use price feeds from established data providers as resolution sources.

Fees and Costs

Kalshi's fee structure is straightforward but worth modeling carefully before scaling position sizes.

Trading fees: Kalshi charges a fee on each trade, applied as a percentage of the notional value. As of 2024, the fee is 7% of potential profit — capped at $0.07 per dollar of profit. In practical terms: if you buy YES shares at $0.40 that resolve at $1.00, your gross profit is $0.60 per share. Kalshi takes $0.042 per share (7% × $0.60). On a 1,000-share position, that's $42 in fees on $600 gross profit — a 7% drag.

This structure means fees scale with your upside, not your position size — a thoughtful design that avoids punishing positions on near-certain outcomes. If you buy YES at $0.95, your potential profit is only $0.05 per share, so the fee is $0.0035 per share. Conversely, long-shot positions at $0.05 carry higher effective fee loads relative to stake.

Comparison to traditional brokerages: A stock trader at Fidelity pays $0 per trade. A futures trader at TD Ameritrade pays roughly $2.25 per contract. Kalshi's 7% of profit fee is meaningful — it's not zero-fee trading. Frequent, small-profit trades will be particularly fee-sensitive. Model this before implementing any high-frequency strategy.

Settlement fees: No separate settlement fee. Resolution and payout processing are included in the trading fee structure.

Withdrawal fees: Kalshi does not charge fees for ACH withdrawals. Wire transfer withdrawals may incur bank-side fees depending on your financial institution — Kalshi itself does not add a surcharge.

No maker/taker distinction: Unlike equity options markets, Kalshi applies the same fee rate regardless of whether your order adds or removes liquidity. This simplifies cost modeling but removes an incentive for passive order placement that some exchanges use to improve liquidity.

Payment Speed and Fees

Deposits:

• ACH transfer: Free, typically settles in one to three business days. Kalshi may offer provisional trading credit before funds fully clear for verified accounts with positive history.
• Wire transfer: Faster settlement (same or next business day) but subject to your bank's outgoing wire fee, typically $15–$30. Kalshi does not charge on the receiving end.
• Debit card: Available in some account configurations; instant credit but confirm current availability in your account settings, as this has been rolled out selectively.

No cryptocurrency, PayPal, Venmo, or check options are currently supported. The fiat-only model is a deliberate regulatory choice, not an oversight.

Withdrawals:

• ACH: Free, one to three business days. The most common method.
• Wire transfer: Available for larger withdrawals; standard bank fees apply.

KYC triggers: All accounts require identity verification before trading — Kalshi is federally regulated and applies full Know Your Customer procedures at account opening, not triggered by deposit threshold. You'll need a government-issued photo ID and a Social Security number. Non-US persons face significant restrictions; Kalshi's regulatory license is US-specific.

Accounts flagged for unusual activity may be asked for additional documentation, including source-of-funds verification for large deposits. This is standard for a CFTC-regulated entity.

Licensing and Trust

Kalshi holds a Designated Contract Market (DCM) license from the Commodity Futures Trading Commission (CFTC) — the same regulatory category as the Chicago Mercantile Exchange and CBOE Futures Exchange. This is not a gaming license, a state-level sports betting authorization, or a foreign jurisdiction registration. It is a federal financial markets license, and it carries corresponding obligations.

Regulatory background: Kalshi's DCM designation, granted in 2020 after a multi-year application process, gives it legal authority to offer binary event contracts to US persons. The CFTC approval was not without controversy — competing exchanges and some lawmakers challenged the scope of markets Kalshi could offer, particularly election markets. Kalshi won a federal court ruling in 2024 affirming its right to list election contracts, a landmark outcome for the prediction market industry.

Parent company: Kalshi Inc., a Delaware-incorporated private company. Funding rounds have included Sequoia Capital and other institutional venture investors. The company is not publicly traded.

Segregated funds: Customer funds are held in segregated accounts, separate from Kalshi's operating capital — a standard CFTC requirement that provides meaningful protection in the event of company financial distress.

Security features: Two-factor authentication (2FA) is available and recommended. The platform uses standard TLS encryption for data in transit. No history of material security breaches has been publicly disclosed.

Independent audits: As a CFTC-regulated DCM, Kalshi is subject to regular regulatory examinations. Third-party financial audits are conducted in accordance with CFTC requirements. These are not published publicly in the same format as listed company audits, but the regulatory oversight framework is substantially more rigorous than unregulated prediction platforms.

User Experience and Mobile

Web platform: Clean, functional, and fast. Market pages load quickly and display the order book, recent trade history, and contract resolution criteria clearly. The price chart for each market shows historical contract prices over time — useful for identifying sentiment shifts around news events. Navigation is logical; finding markets by category or searching by keyword both work well.

Mobile app: Available on iOS and Android. The app mirrors web functionality without significant feature gaps. Order placement, portfolio monitoring, and market browsing all work as expected. The app earns consistent 4+ star ratings on both app stores. One legitimate criticism: the order entry interface on mobile requires extra taps to adjust between YES and NO positions — a minor friction point when markets are moving quickly.

Language support: English only. This is unsurprising given the US-regulatory focus, but worth noting for international users navigating the platform.

Onboarding UX: The account creation flow is well-designed. Identity verification typically completes within minutes using automated document scanning, though edge cases (unusual ID formats, name mismatches) can require manual review and add hours to the process.

No paper trading mode: Kalshi does not offer a simulated trading environment. New participants must use real money to learn the mechanics. Manifold Markets, by contrast, offers play-money markets that serve a learning function Kalshi currently skips.

Customer Support

Email support: The primary support channel. Response times generally run four to twelve hours for routine inquiries during business hours, longer on weekends. Complex account issues can take two to three business days.

In-app chat: Available for basic queries; functions more as a support ticket intake than true live chat. Do not expect immediate resolution of time-sensitive issues through this channel.

Community and social: Kalshi maintains an active presence on X (Twitter) and a Discord server where users discuss markets and occasionally get platform questions answered. Community managers respond, but these channels are not official support mechanisms and should not be relied upon for account-specific issues.

No phone support: There is no published customer service phone number. For a regulated financial entity handling real money, this is a genuine gap. Traders dealing with urgent account access issues or disputed resolutions have limited options for rapid escalation.

Responsible Gambling Tools

Kalshi frames its platform as financial trading, not gambling — a distinction backed by its CFTC license. Nevertheless, the pattern-of-use risks are real: leveraged binary outcomes, 24/7 market access, and emotional involvement in political or sports outcomes can drive compulsive behavior.

Deposit limits: Users can set daily, weekly, or monthly deposit limits through account settings. These are available proactively — you do not need to reach a loss threshold to activate them.

Position and loss limits: Kalshi allows users to set maximum position sizes and loss limits per period. The controls are present but navigating to them requires some effort through the settings menu; they are not prominently surfaced during onboarding.

Self-exclusion: Temporary and permanent self-exclusion options exist. Permanent exclusion requires contacting support directly, which adds friction — this is suboptimal for someone in a distress situation.

Cool-off periods: Short-term account pauses are available without requiring full exclusion.

Problem trading resources: Kalshi's platform includes links to the National Problem Gambling Helpline (1-800-522-4700) and NCPG resources. The framing as financial trading means the responsible-use messaging is less prominent than on licensed sports betting platforms — something the company could improve.

Pros and Cons

Pros

• Federally regulated DCM license — the strongest legal protection available for US prediction market participants
• Deep liquidity in political and economic markets, with tight spreads during active periods
• Central limit order book enables genuine price discovery and limit order strategies
• Transparent resolution criteria specified in advance for every contract
• Customer funds held in segregated accounts per CFTC requirements
• Expanding market catalog covering politics, economics, sports, weather, and AI milestones
• Mobile app is functional and well-maintained

Cons

• Fiat-only deposits and withdrawals exclude crypto-native traders and limit payment flexibility
• 7% of profit fee is material, particularly for high-frequency or small-edge strategies
• No paper trading or simulated environment for new participants
• Customer support lacks a phone channel and live chat is slow — a real issue for account emergencies
• Thin order books in niche markets (weather, AI, some sports) make large positions difficult to execute without price impact
• Self-exclusion requires manual support contact rather than instant in-platform activation

How Kalshi Compares

Kalshi vs. Polymarket: Polymarket is a decentralized prediction market built on the Polygon blockchain, primarily accessible to non-US users (US persons are restricted under Polymarket's terms). It accepts USDC and operates without the regulatory overhead of a CFTC license — which means lower friction for crypto-native users outside the US, but no regulatory recourse for disputes and no legal protections for Americans. Polymarket often has comparable or higher liquidity on major political markets and charges lower effective fees. For a non-US trader comfortable with self-custody crypto wallets and willing to accept counterparty risk from a smart-contract infrastructure, Polymarket is a legitimate alternative. For any US-based trader who wants legally protected, tax-reportable positions and the ability to deposit from a bank account, Kalshi is the clear choice. The CFTC DCM designation is not a marketing claim — it is substantive legal protection that Polymarket cannot offer US residents.

Kalshi vs. Manifold Markets: Manifold is a play-money prediction market with a small real-money component still in limited rollout. It operates without a federal financial markets license and should be understood primarily as an information aggregation and forecasting tool, not a trading platform. Manifold's great strength is the breadth and creativity of its markets — community members create contracts on obscure topics that Kalshi would never list. For anyone who wants to learn the mechanics of prediction markets without risking money, or who wants to trade on niche topics unavailable elsewhere, Manifold serves a distinct purpose. As a venue for serious capital deployment, it is not comparable to Kalshi.

The competitive picture is essentially this: Kalshi is the only legitimate option for US residents who want real-money event contract trading with federal regulatory protection. Non-US traders have more choices, and crypto-native participants globally will find Polymarket's infrastructure more natural. Neither competitor replicates what Kalshi uniquely offers within the US jurisdiction.

How to Sign Up

1. Navigate to kalshi.com and click "Sign Up." The process takes approximately five to ten minutes if your documents are ready.

2. Enter your email address and create a password. Kalshi sends a verification email; click the confirmation link before proceeding.

3. Provide personal information: full legal name, date of birth, residential address, and Social Security number. This is mandatory for CFTC compliance — there is no anonymous or pseudonymous account option.

4. Complete identity verification: Upload a government-issued photo ID (US driver's license or passport). Kalshi uses automated verification software. Most accounts are approved within two to five minutes. If the automated system cannot confirm your identity, a manual review adds several hours.

5. Link a bank account for ACH deposits: You'll need your bank's routing number and your account number. Some banks support instant verification via credentials; others use micro-deposit verification (one to two business days).

6. Fund your account: Initiate your first ACH deposit. Minimum deposit amounts are low (check current platform minimums, as these may update). Wire transfers are available for larger initial funding.

7. Explore markets and place your first position: Review the contract resolution criteria for any market before entering a position. Understand the fee structure and confirm your order price reflects the limit you intend — do not place market orders in illiquid books.

Frequently Asked Questions

Is Kalshi legal in the United States? Yes. Kalshi holds a Designated Contract Market license from the CFTC, making it the only federally licensed real-money prediction market in the US. This distinguishes it legally from offshore or unregulated platforms. US residents can use it without the legal ambiguity that attaches to some other prediction market platforms.

How are Kalshi winnings taxed? Kalshi issues 1099 forms to US taxpayers. Profits from event contract trading are generally treated as ordinary income or capital gains depending on holding period and contract structure — the tax treatment of CFTC-regulated binary contracts is nuanced. Consult a tax professional familiar with commodity contracts before assuming standard capital gains treatment applies.

Can I withdraw my money at any time? Yes, subject to standard ACH processing times of one to three business days. There are no lock-up periods on deposited funds. Funds tied up in open positions cannot be withdrawn until those positions are closed or settled.

What happens if Kalshi goes bankrupt? Customer funds are held in segregated accounts per CFTC requirements, separate from Kalshi's operating capital. This does not guarantee zero loss in all scenarios, but it provides meaningful protection compared to platforms that commingle customer and company funds. Kalshi is also subject to CFTC financial oversight that applies capital requirements and reporting obligations.

Why can't I use cryptocurrency to deposit? Kalshi's CFTC regulatory framework governs it as a commodity futures exchange, and its current operational model accepts only USD via bank transfer. This is a deliberate compliance choice. It may change in future product iterations, but there has been no public commitment to adding crypto payment rails.

How do I dispute a market resolution I think is incorrect? Kalshi specifies resolution sources in each contract's terms. If you believe a resolution was applied incorrectly relative to the stated criteria, you can contact Kalshi's support team with documentation. Unresolved disputes can ultimately be escalated to the CFTC — a meaningful recourse path unavailable on unregulated platforms. Resolution disputes are rare but not impossible, particularly in markets where the outcome depends on contested data or announcements.

Verdict

Kalshi earns its 4.7/5 rating primarily on the strength of one differentiating fact: it is the only federally licensed prediction market in the United States. For US-based traders who want to take positions on political, economic, and event outcomes without operating in a legal gray zone, the CFTC's DCM designation is genuinely valuable. The platform supports real price discovery through a central limit order book, segregates customer funds per regulatory requirements, and provides a resolution framework backed by federal oversight. These are not trivial features.

The tradeoffs are real and worth stating plainly. The 7% of profit fee structure creates meaningful drag on strategies that depend on frequent trading or small edges. Fiat-only deposits exclude a segment of traders who prefer crypto payment rails. Liquidity in non-political markets is uneven, and thin order books in weather or AI markets can make execution costly. The support infrastructure — specifically the absence of a phone channel and the slow live chat — falls short of what a regulated financial platform should offer participants dealing with account emergencies.

The clearest use case for Kalshi is a US-based participant who wants to express high-conviction views on political or macroeconomic outcomes, hedge existing portfolio exposures, or simply participate in what is genuinely a novel and legal asset class. It is not the right tool for anyone seeking high-frequency trading on tight margins, crypto-native workflows, or markets on obscure topics outside Kalshi's current catalog. Non-US participants, particularly those comfortable with decentralized infrastructure, will find Polymarket a more accessible alternative. For everyone else operating within US jurisdiction, Kalshi is the most credible option available.