BTC $84,272 
ETH $2,716 
USDT $0.9996 
BNB $770.93 
XRP $1.51 
USDC $0.9998 
SOL $119.37 
TRX $0.3373 
ZEC $1,441 
FIGR_HELOC $1.03 Kalshi to end volume rewards as ether trade scrutiny grows
The exchange filed to end its Volume Incentive Program no earlier than October 13 while regulators review repeated ether perpetual trades.
Key takeaways
- The program ends soon. Kalshi's Volume Incentive Program can end no earlier than October 13, per its Sept. 28 CFTC filing.
- Volume reached a record. September volume reached $52.98 billion through Sept. 29, above August's $38.67 billion total.
- Trades drew scrutiny. More than $5 billion in repeated ether perpetual trades drew regulatory scrutiny, according to reports.
What happened
Kalshi filed with the Commodity Futures Trading Commission to end its Volume Incentive Program. The exchange set the earliest end date at October 13.
The program began in March 2023. Kalshi's filing does not give a reason for the change, and it does not connect the decision to the recent perpetual futures allegations.
The termination came during a record month for Kalshi. September volume reached $52.98 billion through Sept. 29, above August's total of $38.67 billion.
Kalshi also filed a separate Deposit and Trading Reward Incentive Program on Sept. 25, which sits under a 10-day review. Ending the older program does not end every Kalshi incentive.
Why it matters
Regulators are looking at repeated ether perpetual futures trades on the platform. More than $5 billion in similar Ether perpetual trades drew regulatory scrutiny, according to reports. Many trades were close to $5,500 each.
A trader using the name Beni pointed to roughly $538.6 million in 24-hour ETH perpetual volume against approximately $3.1 million in open interest.
Kalshi denies wash trading. It says the repeated trade sizes came from market makers posting steady quotes, and that faster traders matched them. The company says its systems block traders from matching with themselves.
Kalshi separates its volume incentive program from its perpetual futures market maker programs. It says those programs pay for keeping orders open at set prices, not for the number of trades that follow.
Reuters reports the exchange is discussing a $1 billion raise at a roughly $40 billion valuation. Sequoia Capital and Wellington Management were named as potential lead investors.
What the data shows
- September volume reached $52.98 billion through Sept. 29, above August's $38.67 billion.
- In July, Kalshi handled about $37.7 billion of the $50.6 billion recorded across Kalshi, Polymarket and Polymarket US.
- Event-contract rewards are capped at $0.005 per contract. Each reward period can run no more than 31 days.
- Trades generally must occur between $0.03 and $0.97. The filing says the price range does not apply to perpetual futures.
- Kalshi added perpetual futures for BNB, Cardano, Worldcoin, Aave and Venice Token, bringing its lineup to Bitcoin plus 17 other coins.
- Crypto perpetual futures volume passed $5.5 billion within two weeks of launch.
What is still unclear
- The filing does not explain why Kalshi is ending the program, and it does not tie the decision to the perpetual futures allegations.
- The CFTC look at the ether trades was described as a review, not a formal investigation. Kalshi says it was not contacted by the CFTC about the matter.
- Ending the Volume Incentive Program does not mean Kalshi has ended its perpetual futures incentives.
Questions readers ask
What is Kalshi's Volume Incentive Program?
It began in March 2023 and paid eligible traders a share of a fixed reward pool based on their qualifying completed volume in a market. Event-contract rewards are capped at $0.005 per contract.
When will Kalshi end its volume rewards?
The Sept. 28 CFTC filing says KalshiEX intends to terminate the program, and the change can happen no earlier than October 13.
Why are Kalshi's ether trades under review?
The Wall Street Journal reported that the CFTC was examining trading patterns involving nearly identical Ether perpetual transactions, many close to $5,500 each. The Journal described this as a review, not a formal investigation.
Is Kalshi raising new funding?
Reuters reports Kalshi is discussing a $1 billion raise at a roughly $40 billion valuation. Sequoia Capital and Wellington Management were named as potential lead investors.
