Washington DC Court allows Kalshi users to trade in the 2024 election prediction market. This decision allows Kalshi to compete directly with the decentralized Polymarket.
Court Decision and Its Effects
The decision made in court allows Kalshi to compete with platforms such as Polymarket. Polymarket has seen a 7,000% increase in forecast market volume through the end of August this year. The court stated that there was no concrete evidence of harm that could hinder Kalshi’s activities.
Kalshi spent $200,000 in Washington in 2021 and 2022 in an attempt to influence the government in his favor. The company said it would spend $1.5 million on national advertising campaigns if election prediction markets were allowed.
Election prediction markets account for approximately 80% of trading volume on Polymarket. Rival platform PredictIt experiences significant user growth during election periods in the US. Kalshi’s court decision allows American users to participate in prediction markets without using a VPN or crypto wallet.
“The CFTC failed to provide sufficient evidence of harm against Kalshi at this time, so we deny his appeal.”
Still, the CFTC may be right in its stance against these platforms regarding speculative transactions and the risk of influencing the election. In many regions, it is considered illegal to use platforms where bets are placed on the outcomes of such events.
Future Prospects
Kalshi started placing election bets after the court decision. However, there is also an appeal process. The court decision is expected to become final in 2025. In this process, Kalshi’s ability to continue its election prediction markets services (whether it can continue after 2025) will depend on the final decision.
This development will provide American citizens with the opportunity to predict election results and strengthen Kalshi’s position in the market. Users also had the opportunity to make predictions from a US-based platform without resorting to offshore platforms such as Polymarket.
Kalshi’s continuation of its activities in the election prediction market is seen as an important step for the future of the sector and its relations with regulatory institutions. The company’s investment and marketing strategies will continue to shape the competition in this field.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that crypto currencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
