Kalshi
What is a prediction market?
A prediction market is a contract-based platform that allows users to trade on the outcomes of real-world events. Participants buy contracts that pay out if a specified outcome occurs. Prices reflect the market's collective probability estimate for each outcome. Unlike traditional gambling, prediction markets use a financial contract structure and, where CFTC-regulated, operate under federal oversight as Designated Contract Markets. Kalshi is currently the largest CFTC-registered prediction market in the United States by trading volume.
Platform Overview
Kalshi, operating as KalshiEX LLC (a Delaware limited liability company), is the United States' first CFTC-registered Designated Contract Market (DCM) for event contracts. The platform launched in 2021 following a legal battle with the CFTC over whether political event contracts were permissible under the Commodity Exchange Act. A federal district court ruled in Kalshi's favour in September 2024, and the CFTC dropped its appeal in May 2025, clearing the legal path for political markets. Kalshi recorded $23.8 billion in total notional trading volume in 2025, representing more than 1,100% year-over-year growth, and opened 2026 with approximately $291 million in daily notional volume on January 1.
The platform's commercial position was significantly strengthened by a $1 billion Series E funding round at an $11 billion valuation (led by Paradigm, with Sequoia Capital and Alphabet's CapitalG), and a distribution partnership with Robinhood that reportedly accounts for more than half of Kalshi's trading volume. Kalshi has also secured data integration agreements with CNN, CNBC, and Google. Trading is conducted on an order book model through binary and scalar contracts, settling at $1.00 per contract if the outcome resolves in a position's favour. The platform's interface has a deliberately financial aesthetic rather than a gaming one, which distinguishes it from less-regulated prediction market products.
Kalshi's CFTC status is its primary differentiator and also its most contested attribute. As a DCM, Kalshi argues that the Commodity Exchange Act grants the CFTC exclusive jurisdiction over its contracts, preempting state gambling laws. At the time of this review, Kalshi is not available in nine US states (AZ, IL, MA, MD, MI, MT, NJ, NV, OH) as a result of ongoing state enforcement actions, cease-and-desist orders, or both. Arizona filed a 20-count criminal information against KalshiEX LLC in March 2026. The CFTC filed federal lawsuits against Arizona, Connecticut, and Illinois in April 2026 to defend Kalshi's operating position. This regulatory environment is active and evolving. See the Regulatory Status section for detail.
Research Basis
Editorial Analysis
T&C Risk Score Breakdown
Scored 0–2 per criterion using primary documents only. Scores are set by Wager Layer and reflect what the Member Agreement and Rulebook actually say, not marketing language. Higher scores indicate more trader-favourable terms. All scores set in 0.5 increments.
Market Categories
Markets & Coverage
Cost Structure
Fees & Trading Terms
| Fee Type | Rate | Notes | Source |
|---|---|---|---|
| Taker Fee (general markets) | ~1.75¢ per contract at 50¢; fee scales with P × (1-P) | Probability-weighted formula: fee decreases as price moves toward 0¢ or 100¢. Highest at 50¢ (50% probability). Charged at trade execution. | Kalshi Fee Schedule, effective Feb 5, 2026 |
| Maker Fee (general markets) | 25% of taker fee (~0.44¢ at 50¢) | Applied to resting (limit) orders on the order book. Only charged when order executes; no fee for cancelling unexecuted orders. | Kalshi Fee Schedule, effective Feb 5, 2026 |
| Financial Markets (S&P 500, NASDAQ100) | round_up(0.035 × C × P × (1-P)) | Separate formula for index markets. C = contract value; P = price (probability). Separate maker/taker split applies. | Kalshi Fee Schedule, effective Feb 5, 2026 |
| Settlement Fee | None | No fee charged when a contract settles. This is materially better than several competing platforms. | Kalshi Fee Schedule, effective Feb 5, 2026 |
| ACH Deposit / Withdrawal | None | No fee for ACH bank transfers in either direction. ACH deposits are subject to the 90-day originating-account restriction on withdrawal (Member Agreement §VII(J)). | Kalshi Fee Schedule, Feb 5, 2026; Member Agreement §VII(H/J) |
| Debit Card Deposit / Withdrawal | 2% processing fee | Applied to both deposits and withdrawals via debit card. Wire transfer fees are bank-dependent and not fixed by Kalshi. | Kalshi Fee Schedule, Feb 5, 2026; community-confirmed across 3+ sources |
| Position Limits | Per-contract; Rulebook Chapter 5 | Position limits are market-specific and defined per contract. Accountability levels apply to larger positions. Limits are disclosed in contract specifications before trading. | DCM Rulebook v1.26, Rules 5.18–5.19 |
Kalshi's fee structure is among the more transparent in the US prediction market sector. The probability-weighted formula means that trading near-certain outcomes is cheap, while trading close to 50/50 markets carries the highest per-contract fee. For context, a sportsbook vig on an equivalent 50/50 market typically runs 4.5–10%, making Kalshi's effective 1.75% taker fee materially lower. The absence of settlement fees and ACH transfer fees further reduces the friction of entry and exit. The 2% debit card processing fee is an outlier that effectively penalises users who cannot or do not use bank transfers.
Settlement Framework
Market Resolution
| Dimension | Detail |
|---|---|
| Resolution Source | Per-contract "Source Agency" defined in contract specifications. Typically authoritative data sources (government agencies, official league data, major news outlets). Rulebook defines "Source Agency" as the body publishing the Underlying and Expiration Value. |
| Resolution Timeline | Contracts expire on the Expiration Date per contract terms, regardless of platform accessibility. Settlement occurs at the Clearing House upon resolution of the Expiration Value. No general timeline stated for post-resolution payout release. |
| Dispute Process | Traders can submit a "Request to Settle" as a suggestion to the platform. The Outcome Review Committee (a board-level committee) makes binding determinations per Rulebook Rule 7.1. Disputes between members are resolved via Kalshi arbitration under Rulebook Chapter 10. There is no external arbitration pathway or independent ombudsman for resolution disputes. |
| Resolution Criteria Disclosed Pre-Trade | Partially — varies by contract |
| Platform Override Rights | Rulebook Rule 6.3(c) permits Kalshi to settle a market at its last traded price if the outcome is deemed "unresolvable." Rule 7.2 allows contract modifications. Emergency powers under Rulebook Rule 2.8 permit the board to take immediate action affecting any contract without prior notice. |
Resolution Risk
Two high-profile resolution disputes have been documented in 2025–2026. In the first, markets on a Bernie Sanders rally resolved as "No" on all options despite attendees providing audio and video evidence that Sanders used the specified words; more than $3 million was wagered on those markets and the dispute generated widespread criticism, including a Trustpilot review pattern and viral social media coverage. In the second, a market on "Ali Khamenei out as Supreme Leader?" settled at last traded price under a "death carveout provision" when Khamenei died; a class action was filed in the US District Court for the Central District of California alleging the carveout was buried in technical documentation and not disclosed to typical traders before they committed funds. Kalshi refunded trading fees and reimbursed net losses in the Khamenei case but disputed the characterisation of the disclosure gap. Both cases illustrate the risk of platform-controlled resolution criteria with no independent appeal mechanism.
Terms vs Reality
Rules state: Per Rulebook Rule 7.1, an Outcome Review Committee (ORC) reviews disputed outcomes. The ORC is a committee of the Board and makes binding determinations.
Community-reported reality: The only practical recourse available to retail traders who dispute a resolution is informal contact (Discord, email, or a non-binding "Request to Settle"). There is no external arbitration pathway for resolution disputes specifically. Multiple community sources characterise the outcome as: "Yell at them in Discord." The ORC has formal authority but traders have no standing to trigger a review or appeal its findings independently.
Cashflow Terms
Fund Access & Withdrawals
| Term | Detail | Source |
|---|---|---|
| Min. Withdrawal | Not specified in Member Agreement; per Rulebook procedures. Does not enforce a strict minimum withdrawal amount. | Member Agreement §VII; Rulebook Rule 6.4 |
| Withdrawal Timeline |
Withdrawals via debit card, cryptocurrency, and PayPal/Venmo are generally completed within a 30-minute timeframe. Standard bank transfers typically require several business days for processing. |
Member Agreement §VII(F); Rulebook Rule 6.4 |
| Withdrawal Methods | ACH bank transfer; debit card; wire transfer; crypto (via ZeroHash integration). | Platform; Trustpilot community reports (ZeroHash crypto partner confirmed) |
| ACH 90-Day Lock | ACH deposits may only be withdrawn to the originating external account within 90 days of transfer. | Member Agreement §VII(J) |
| Identity Verification | KYC required at registration. Kalshi may conduct ongoing verification, background checks, and credit report reviews. Periodic re-verification authorised. Failure to provide requested information may restrict access. | Member Agreement §VII(K/L); PATRIOT Act Notice §XIX |
| Fund Segregation | Participant funds held at the Clearing House (Kalshi Klear). CFTC Regulations 22.2(e)(1) and 1.25 apply. Kalshi may invest member funds in permissible instruments without notice to you (Member Agreement §VIII). Segregation from operating capital is implied by DCM structure but not explicitly stated as a guarantee to retail users in the Member Agreement. | Member Agreement §VIII; Rulebook Rule 8.1 |
| Account Suspension | Kalshi may suspend Services or terminate the Agreement at its sole discretion for failure to comply with terms (§VII(S)). ACH return or reversal may temporarily restrict account privileges (§VII(H)). Termination does not affect accrued liability. Summary suspension under Rulebook Rule 9.6 applies in emergency and disciplinary contexts. | Member Agreement §VII(S), §VII(H), §XIII; Rulebook Rule 9.6 |
The absence of a stated withdrawal timeline in the Member Agreement is a material gap. The agreement defers to the Rulebook, but the Rulebook (Rule 6.4) describes the withdrawal settlement process in structural rather than timeline terms. The 90-day ACH originating-account restriction is an unusual constraint: if you fund via ACH and then close your bank account or change banks, withdrawal access to those specific funds becomes complicated. The "nonrefundable" deposit language in §VII(F) does not mean you cannot withdraw winnings or remaining balances, but it does mean that the act of funding the account itself is not reversible as a consumer transaction, which is a distinction from standard bank or payment app mechanics. Multiple Trustpilot reviews specifically describe withdrawal blocks after KYC verification, which Kalshi's own Trustpilot responses attribute to CFTC-mandated compliance procedures. Kalshi's crypto partner ZeroHash has been referenced by community members as more responsive than Kalshi's own support for crypto withdrawal issues.
Legal & Compliance
Regulatory Status
Kalshi holds the most robust federal registration available to a US prediction market: CFTC DCM status, which places it alongside futures exchanges like the CME. The CFTC has actively defended this position by filing federal lawsuits against Arizona, Connecticut, and Illinois on April 2, 2026, seeking permanent injunctions against state enforcement. Courts have been inconsistent: federal district courts in Nevada and New Jersey initially sided with Kalshi on preemption; the Nevada ruling was later overturned at the appellate level (Ninth Circuit), resulting in a confirmed two-week service halt enforced in early 2026. The Maryland district court sided with the state, creating a federal circuit split. Arizona's criminal filing (20-count information, March 17, 2026) is the most serious state action to date and includes election wagering and betting/wagering counts.
Primary Document Analysis
T&C Clause Analysis
Key clauses from the KalshiEX Member Agreement (v1.6, current) and DCM Rulebook (v1.26, current). All quoted language is verbatim from the published documents.
Trader Experience
Community Reports
Methodology
The following findings reflect patterns across a minimum of three corroborating reports per finding. Individual anecdotes are not cited. Sources: Trustpilot (182 reviews, avg 1.9 stars, accessed May 2026), r/Kalshi (29k subscribers), quasa.io community analysis (Feb 2026), defirate.com resolution analysis (Apr 2026). All sources are named public forums or named publications. No single anecdotal account is presented as a pattern.
The dominant complaint pattern across Trustpilot (the AI summary of 182 reviews specifically flags this as "most reviewers") describes withdrawals as difficult or impossible, with funds described as "locked" or "disappearing." Multiple reviews document accounts suspended or restricted after KYC verification, often without explanation beyond "risk control" or "compliance." Kalshi's own Trustpilot responses acknowledge the KYC requirement is CFTC-mandated federal compliance, which is accurate, but the responses consistently redirect users to email support without resolving the pattern of complaints. A second distinct sub-pattern involves users experiencing withdrawal blocks for weeks after submitting identity verification, citing no clear timeline being communicated.
Multiple Trustpilot reviewers describe receiving clearly AI-generated canned responses from Kalshi support, with one reviewer detailing a successful escalation to ZeroHash (Kalshi's crypto partner) after Kalshi's own support failed to resolve a crypto withdrawal delay. A separate incident documented in Trustpilot reviews involves a Kalshi customer experience team member (named Willy) in the official Discord behaving inappropriately toward users asking for help. Kalshi's own review responses confirm the platform is hiring in its CX team (noting the hire in January 2026), suggesting awareness of the support gap. The general pattern is: email support slow to non-responsive, Discord escalation inconsistent, ZeroHash more responsive for crypto issues.
The Bernie Sanders rally market in early 2026 (total wagered: $3M+) resolved "No" on all contracts despite audio and video evidence from attendees showing Sanders using the specified words. This generated more than 10,000 likes on a single trader's complaint post on social media, multiple Trustpilot reviews referencing it, and press coverage describing it as a "mismatch between real events and rigid resolution criteria" (quasa.io, Feb 2026). The Khamenei death carveout market, where $54M+ was traded, resulted in a class action filed in the US District Court for the Central District of California (Risch v. Kalshi LLC), with plaintiffs claiming the death carveout provision was buried in technical documentation and not visible to typical traders pre-trade. Kalshi refunded fees and reimbursed net losses in the Khamenei case but characterised the carveout as properly disclosed.
A minority but consistent subset of Trustpilot reviewers (cited in the Trustpilot AI summary) describe payouts as fast and reliable, with individual customer service representatives praised by name for prompt resolution. Kalshi also publicly disclosed two insider trading enforcement cases in February 2026, one involving a MrBeast editor, noting it had conducted 200+ investigations and referred active cases to the CFTC. This proactive enforcement posture distinguishes Kalshi from less regulated platforms where insider trading operates unchecked. The platform's growth trajectory ($23.8B volume, 2025) and institutional backing suggest market infrastructure is generally functional, with problems concentrated in KYC holds and high-ambiguity resolution cases.
Wager Layer Editorial Assessment — Kalshi
The US Market Leader in Prediction Contracts — Legitimate Federal Standing, Real Risks Around Resolution, Withdrawals, and Nine Unavailable States
Kalshi holds the strongest possible federal regulatory designation available to a US prediction market, a CFTC Designated Contract Market, and the CFTC is actively defending that status against state enforcement actions in federal court. This is not a marginal or contested registration: it places Kalshi in the same regulatory category as major US futures exchanges. For traders who prioritise federal oversight and fund segregation under CFTC rules, this is materially more protective than offshore or unregistered alternatives. The platform's fee structure is transparent and competitive, its market breadth is the widest available in a US-regulated format, and its institutional backing at an $11B valuation provides structural stability.
The Moderate Risk score reflects three distinct problem areas that are documented and material. First, market resolution: the Bernie Sanders and Khamenei cases demonstrate that in ambiguous or carveout scenarios, the Outcome Review Committee holds unilateral final authority with no external appeal, and that per-contract resolution criteria are not always prominent enough for retail traders to assess before committing capital. Second, fund access: the Member Agreement describes deposits as nonrefundable completed transactions, the 90-day ACH lock is not prominently disclosed, and Trustpilot complaint patterns at scale suggest withdrawal blocks connected to KYC holds are a recurring friction point, not isolated incidents. Third, state legal exposure: Arizona's criminal charges (20 counts, March 2026) are the most serious regulatory action any US prediction market has faced, and while the CFTC is counter-suing, the outcome is not determined and nine states are currently inaccessible.
The structural tension at Kalshi is between its genuine regulatory legitimacy and the practical gaps in its retail trader protections. A CFTC DCM registration governs platform conduct at the exchange level; it does not guarantee that individual traders have meaningful recourse when a resolution dispute arises or when funds are held during a KYC review. Traders treating Kalshi as they would a licensed casino, expecting consumer-grade dispute rights, will find the Member Agreement is designed for financial market participants, not consumer protection frameworks. Traders who understand they are operating within a CFTC-regulated derivatives structure, read contract terms before entering positions, use ACH funding, and do not rely on near-certain-outcome carveout markets will encounter fewer of the documented risks.
Version History
Change Log
| Date | Update | Primary Source |
|---|---|---|
| May 2026 | Profile published. T&C analysis based on Member Agreement v1.6 (current), DCM Rulebook v1.26, and Fee Schedule effective February 5, 2026. Regulatory analysis reflects CFTC v. Hobbs (Arizona), April 2, 2026, and state enforcement tracker data through May 2026. | kalshi-public-docs.s3.amazonaws.com; cftc.gov; lines.com state tracker |