Kalshi Says No Formal CFTC Probe, Rejects Volume-Inflation Allegations

Kalshi, the U.S. prediction market platform, has denied that regulators are investigating unusual trading patterns in its crypto derivatives markets.

CoinDesk reported on September 23 that Kalshi said it had not been contacted by the U.S. Commodity Futures Trading Commission and does not believe any formal investigation is underway.

The company also pushed back on recent allegations of inflated trading volumes, saying the activity reflects common trading patterns seen in incentive programs that reward liquidity providers.

Repeated trades of identical size were previously identified in Kalshi's Bitcoin and Ether perpetual futures markets. In Ether, trading was concentrated in orders of about $5,500. In Bitcoin, activity was clustered around trades of about $2,500 and $5,000.

The Wall Street Journal reported that roughly 1 million trades of similar size took place in the Ether market and that the CFTC is reviewing related data. It added that regulators have not yet decided whether to open a formal enforcement investigation.

According to Beni, co-founder of market research firm Stealth Neolabs, Kalshi's Ether perpetual futures market recorded about $539 million in 24-hour trading volume, while open interest stood at just $3.1 million. During four days in September, trades of exactly $5,500 accounted for 48% to 58% of total notional volume.

Elizabeth Diana, a Kalshi spokesperson, said such data patterns are common in liquidity incentive programs and are frequently seen across financial markets. She added that Kalshi submits trading data to the CFTC every day and that routine regulatory data reviews do not amount to a formal investigation.

Kalshi also said it operates a separate surveillance team and monitoring tools to prevent self-trading and wash trading. The CFTC did not respond to a request for comment on the report.