KALSHI Bets: Understanding Kalshi's Yes/No Markets
Kalshi bets refer to trading YES/NO binary contracts on Kalshi, the U.S.-regulated event-market platform. Each contract resolves to $1.00 if the outcome occurs and $0.00 otherwise. Traders buy YES or NO shares at cents-based prices, with the total price constrained to $1.00 across both sides for a given market. Kalshi’s design requires KYC, a funded account, and adherence to CFD CFTC rules. This article explains how Kalshi bets work in practical terms and what to consider if you’re evaluating KalshiArb for arbitrage opportunities.
What are Kalshi bets and how do they settle?
Kalshi bets are binary YES/NO contracts tied to real-world events. Each market has two sides: YES and NO. If the event occurs, the YES side pays $1.00 per contract; if it does not, the NO side pays $1.00. Prices move in cents, generally from $0.01 to $0.99, reflecting collective judgment about the likelihood of the outcome. Settlements are USD-based and determined by Kalshi Klear using the market's resolution rule, not by an external oracle. This means the payoff depends on whether the event’s defined criteria are met under Kalshi’s official rule.
Why Kalshi bets matter for arbitrage opportunities
Intra-market edge on Kalshi comes from price imbalances between YES and NO or across mutually exclusive child markets under the same event ticker. When the best-ask YES plus best-ask NO sits below $1.00, there is a theoretical risk-defined edge by buying both sides. This edge is a function of the platform’s pricing, fees, and resolution rules. KalshiArb focuses on identifying these moments where the sum of best asks creates a spread that can be locked in, assuming execution completes and fees are accounted for.
How Kalshi bets are priced and traded on the platform
Prices on Kalshi bets are quoted in cents and must stay within the range of $0.01 to $0.99. The total of YES and NO best asks should equal $1.00 in fair value, but real markets display micro-inefficiencies. Trades occur via a centralized limit order book (CLOB) with standard order types like limit and market orders, plus protections against self-trade. Fees apply per contract and are calculated based on price and size, so edge calculations must include expected costs. KalshiArb integrates with Kalshi’s API to monitor these spreads in near real-time for rapid execution.
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FAQ
- What exactly is a Kalshi bet?
- A Kalshi bet is a binary YES/NO contract on a real-world event. It pays $1.00 if the chosen outcome happens and $0.00 otherwise. The market price is quoted in cents, reflecting probability, liquidity, and fees.
- Is Kalshi regulated or legitimate for U.S. traders?
- Yes. Kalshi is a U.S.-based, CFTC-regulated Designated Contract Market. It settles in USD and operates under U.S. law, with KYC requirements and restricted eligibility by state.
- How can KalshiArb help with Kalshi bets?
- KalshiArb is a non-custodial scanner and AI agent focused on intra-market arbitrage opportunities. It helps identify when YES/NO prices create a guaranteed edge and assists with timing and execution through Kalshi’s API.