Kalshi Asks CFTC to Approve Margin Trading on Prediction Markets

Kalshi filed with the Commodity Futures Trading Commission on Tuesday seeking approval to offer leverage on its event contracts, a move the company says would draw institutional traders to its prediction markets, according to CNBC.

The filing came from Kalshi Klear, the company's internal clearinghouse. Margin trading lets a trader use borrowed funds to gain exposure to more of an asset than their own cash would cover. The practice is standard in equities and derivatives markets, but no regulated U.S. event contract exchange permits it today — all positions on those venues are fully collateralized.

In a memo provided to CNBC, Kalshi said leverage would make longer-dated prediction markets more attractive to institutions. The company also laid out plans for a tiered structure in which the collateral required to maintain a leveraged position would rise the closer a contract gets to settling.

Access would be narrow even if the CFTC signs off. Leverage would be restricted to self-clearing members who satisfy specified capital thresholds, given their direct clearing relationships with Kalshi Klear, a company spokesperson confirmed. Kalshi said it would not offer margin on sports event contracts, or on its culture and "mention" markets.

Leverage already exists on Kalshi's perpetual futures products. The company has not yet cleared the regulatory bar to extend it to its prediction market offerings.

The institutional race

The push for margin access reflects a broader effort by prediction market platforms to attract institutional participation. Polymarket, a rival, moved in July to obtain regulatory licenses that would eventually allow it to offer margin trading on event contracts in the U.S., according to CNBC.

Tuesday's filing is the latest in a string of expansion moves by Kalshi. The platform launched a professional trading terminal for its most active users, offering deeper order book visibility and risk management tools for perpetual positions.

The scale is substantial. Kalshi accounts for more than 90% of prediction market activity in the U.S., with annualized trading volume climbing from $52 billion to $178 billion over six months.

The company has also been expanding internationally. Kalshi partnered with brokerage infrastructure startup Alpaca to make its event contracts available to users outside the U.S., and earlier partnered with Canadian financial firm Wealthsimple to bring its markets to Canada.

CNBC, which reported on the filing, holds a minority stake in Kalshi and has a customer acquisition arrangement with the company.

The CFTC's decision will shape how far prediction markets can converge with traditional derivatives venues — and whether Kalshi can convert its dominant volume position into a leveraged, institution-grade trading business.