Kalshi is facing questions about trading activity on its ether perpetual futures after an analyst on X accused the U.S. prediction market of inflating reported volume.
The dispute centers on Kalshi’s recently introduced crypto perpetual contracts and the unusually wide gap between trading volume and open interest. IcoBeast.eth, who is involved in product development at Kalshi, rejected the allegations and said the criticism misunderstands aspects of the platform’s market structure and reporting practices.
CoinDesk contacted Kalshi for comment but had not received an immediate response.
Analyst Flags Unusual Volume
Beni, a quantitative analyst and co-founder of Stealth Neolab, brought attention to Kalshi’s ETH-PERP contract. He said the ether perpetual market generated $539 million in 24-hour volume while open interest stood at only $3.1 million.
The figures mean that reported volume was approximately 174 times greater than open interest.
Beni said the imbalance resembles a pattern often associated with wash trading, where repeated transactions can increase a platform’s reported volume without producing a comparable level of outstanding positions.
Open interest tracks the total value of contracts that remain active, whereas trading volume measures the value of contracts traded over a particular period.
Beni also highlighted a recurring series of $5,500 transactions. According to his analysis, those trades represented up to 58% of Kalshi’s total ether perpetual volume on four separate days. He described the pattern as evidence that the platform’s volume could be manipulated.
The analyst also referenced a rebate schedule filed with the Commodity Futures Trading Commission. He said certain Self-Clearing Members could potentially face no net trading fee when a 0.3-basis-point maker rebate offsets a 0.3-basis-point taker fee.
Beni’s argument was that reducing the cost of trading to zero could increase the incentive for participants to generate additional transactions.
Rebates are commonly offered by exchanges as incentives for market makers and other high-volume participants, often through fee refunds or payments designed to encourage liquidity.
Kalshi Challenges the Claims
IcoBeast.eth initially argued that Kalshi’s fee structure would make wash trading economically unattractive. After the allegations gained wider attention, he expanded on his response and addressed several points raised by Beni.
He said one of the charts cited in the original criticism contained a key misunderstanding. According to IcoBeast.eth, the Artemis data showed prediction-market share rather than the volume generated by Kalshi’s perpetual contracts.
He also addressed the size of Kalshi’s reported volume figures, explaining that the platform uses a convention similar to Polymarket for event contracts.
Under that methodology, volume reflects the maximum possible payout of contracts rather than the amount of cash initially spent.
For example, purchasing 100,000 contracts at 30 cents each requires $30,000 in upfront capital. Since each contract pays $1 if it wins, the reported volume is $100,000 based on the contracts’ maximum payout.
That approach can produce headline volume figures that are considerably higher than the amount of money initially committed, but Kalshi maintains that the activity still represents genuine contract demand.
IcoBeast.eth also disputed the suggestion that Kalshi selects a restricted group of Self-Clearing Members for its perpetual markets.
He pointed to CFTC requirements governing fair access, saying any company that satisfies the required regulatory, capital and operational standards can seek Self-Clearing Member status.
“Anyone can become a Self-Clearing Member of a CFTC regulated exchange as long as they meet the regulatory requirements,” he said.
He added that Kalshi does not provide rebates for its crypto event contracts.
While rebate programs are widely used by exchanges including CME Group, Hyperliquid and Binance, IcoBeast.eth said Kalshi’s status as a regulated Designated Contract Market requires its incentive programs to be filed publicly with the CFTC.
That disclosure requirement, he argued, allows market participants to see the incentives offered by the exchange instead of relying on privately negotiated arrangements.
Kalshi’s Perpetual Market Is Still New
IcoBeast.eth acknowledged that Kalshi’s U.S. perpetual futures product remains in its early stages. He said the company is developing a new type of product in the U.S. while operating under regulatory requirements that require incentive programs to be publicly disclosed.
He contrasted Kalshi’s structure with offshore perpetual exchanges, arguing that Kalshi’s regulatory obligations provide greater visibility into its trading incentives.
The disagreement now centers on how the unusual volume figures should be interpreted. Beni has pointed to the $539 million in daily volume, $3.1 million in open interest and repeated $5,500 transactions as potential warning signs. Kalshi, meanwhile, says its reporting methodology, market-access rules and regulatory disclosures provide context for the figures and reject the implication that the activity is fabricated.
