Kalshi, a regulated prediction market platform, is engaged in a public dispute over a recent analysis that estimated large losses for ordinary users.
The analysis used maker and taker data from the platform’s API and equated makers with professional traders and takers with casual users, a methodology the company says is inaccurate.
The study estimated total losses of roughly $583.5 million across two platforms through March 2025, attributing about $244.5 million to Kalshi and claiming 86 % of its traders lost money while 1 % captured nearly 80 % of profits.
Kalshi rejected these conclusions, arguing that institutional market makers generate about 97 % of trading volume, leaving retail participants responsible for only around 3 % of activity, and therefore the study misassigned institutional losses to ordinary users.
Critics have challenged Kalshi’s classification, noting that market makers receive fee discounts and direct algorithmic integration, which creates a fundamentally different trading environment from retail participants.
One former executive highlighted that when a market maker places a large bet, the platform’s growth metrics reflect the transaction, yet losses incurred by such makers are not treated as losses for typical customers.
Additional analysis pointed to the platform’s parlay product as a clearer indicator of retail outcomes, noting that takers in parlays cannot act as makers, making them a near‑perfect proxy for everyday bettors.
The discussion has broadened beyond methodological concerns, with observers questioning the consistency of how institutional activity is presented in growth reports versus loss calculations.
The debate underscores ongoing challenges in distinguishing professional liquidity providers from retail users in emerging financial markets.
