Kalshi’s exchange had delays and outages for certain retail users on Saturday, a number of traders first reported on social media and Discord. The outage prevented users who placed trades from exiting their positions during Saturday’s slate of college football games.
However, API users were apparently still able to access the site, allowing some institutional traders to take advantage or “snipe” open orders of locked-out traders. Retail customers who had resting orders, trades that had been submitted to the exchange but not yet executed, were unable to cancel their orders if the prices no longer made sense for them.
Kalshi’s exchange was back up and running later Saturday afternoon, and the company issued refunds to users who experienced a loss on their resting orders.
Kalshi aimed to make things right
The outage took place after 3 p.m. ET on Saturday and Kalshi posted this message on their website following the initial reports: “The exchange is experiencing temporary delays. Balances and positions may not be accurately reflected.”
During the course of the disruptions, a Kalshi representative responded to traders in Kalshi’s Discord support channel around 4:30 p.m. promising to “make things right.” The platform was back to normal before 5 p.m. but some additional complaints of blocked site access arose later in the day.
Some customers received the following email on Saturday evening confirming pending reimbursements for resting orders that were filled during the outage:
A Kalshi spokesperson confirmed to CNBC: “There were some glitches and delays on our web and app product, which affected less than half of our user base.”
While frustration subsided among users in the Discord support channel, some users were still asking for details about the outage as late as Monday morning, with some looking for confirmation that restitution was served in full.
CFTC in flux as new CFTC chair contender emerges
The CFTC isn’t optimally staffed during the government shutdown, which has left only 31 of the 543 CFTC staff members working. However, even a properly functioning CFTC has discretion in how it handles platform outages. A pattern of lost funds or technical difficulties would likely be viewed differently than an isolated temporary outage.
The CFTC will soon have new leadership, too. President Trump has tapped Mike Selig, the Chief Counsel of the SEC’s crypto task force, to be the new CFTC chairman reports indicate. Selig has been largely silent on prediction markets specifically, though he is assured to be a crypto-friendly bridge between the SEC and CFTC if confirmed.
Institutional prediction market customers expanding
As Kalshi continues to manage its retail base, new institutional customers are lining up to use Kalshi as a hedging platform. InGame reported that daily fantasy and sports betting company Underdog plans to use Kalshi to hedge its risks.
At least some companies view Kalshi as a viable hedging platform for the specific risks they incur. It’s a boost to Kalshi’s argument that sports contracts are potentially viable hedging tools, though that argument has yet to fully play out in court.
