Kalshi, a prediction market platform, has announced plans to tokenize thousands of its event contracts on the Solana blockchain, a move that marks a significant step in the company’s crypto expansion.
The move bridges the event prediction platform’s traditional off-chain order book with on-chain liquidity to attract crypto-native traders and scale operations.
Put simply, what the partnership means is that Kalshi bettors will now be able to buy and sell tokenized versions of their wagers on Solana, the company told CNBC exclusively on Monday.
The tokenized versions of the contracts would work the same way as the regular ones hosted previously on Kalshi’s platform. However, by trading the tokens instead of the actual contracts, users can enjoy more blockchain-native benefits.
Kalshi partners with Solana
The development puts Kalshi and its rival Polymarket, which allows users to trade directly on-chain, on the same playing field.
According to what Kalshi told CNBC, decentralized finance protocols DFlow and Jupiter will serve as institutional clients, merging the exchange’s off-chain order book to Solana’s liquidity. The move shows that Kalshi is going all out in its attempt to court crypto holders as demand for event contracts continues to grow.
John Wang, the company’s head of crypto, told CNBC that by tapping into the $3 trillion digital asset market, Kalshi expects it will be able to shore up liquidity needed to scale its offerings at this crucial time when investors’ appetite for prediction markets is growing rapidly.
“There’s a lot of power users in crypto,” Wang said. “This is about tapping into the billions of dollars of liquidity that crypto has, and then also enabling developers to build third party front ends that utilize Kalshi’s liquidity.”
Kalshi has existed since 2018 and was the first exchange to launch federally regulated event contracts on U.S. congressional races for American traders in late 2024, shortly after winning a years-long legal battle against the Commodity Futures Trading Commission.
The platform has now added more event contracts to its platform, and is currently running about 3,500 markets, according to a company representative. Last fall, it raised more than $300 million at a $5 billion valuation in a funding round backed by the likes of Andreessen Horowitz and Sequoia Capital, in addition to expanding its footprint to more than 140 countries.
Polymarket prepares to re-enter the US
Kalshi currently has a first-mover advantage, but it will need to continue to grow quickly if it wants to edge out its rivals, an endeavor that will require ample liquidity – something crypto-native traders’ funds could provide, according to Wang.
Polymarket announced on November 25 that the U.S. Commodity Futures Trading Commission (“CFTC”) has issued an Amended Order of Designation, which allows Polymarket to operate an intermediated trading platform subject to the full set of requirements applicable to federally regulated U.S. exchanges.
The approval means Polymarket will now be able to onboard brokerages and customers directly and facilitate trading on U.S. venues. It is also now permitted to introduce intermediated access, enabling users to trade through FCMs and leverage traditional market infrastructure, custody, and reporting channels.
“People rely on Polymarket because we provide clarity where there is confusion and accountability where there is ambiguity,” said Shayne Coplan, Founder and CEO of Polymarket.
According to Coplan, the approval allows the company to operate in a way that reflects the maturity and transparency that the U.S. regulatory framework demands.
“We’re grateful for the constructive engagement with the CFTC and look forward to continuing to demonstrate leadership as a regulated U.S. exchange,” he said.
As part of the amended order, Polymarket has developed enhanced surveillance systems, market supervision policies, clearing procedures, and part-16 regulatory reporting capabilities. The platform is also expected to implement additional rules, policies, and processes applicable to intermediated trading prior to official launch.
It will also remain subject to all provisions of the Commodity Exchange Act and applicable CFTC regulations governing Designated Contract Markets, including self-regulatory obligations.
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