Volume Manipulation

Kalshi faces accusations that thousands of identical $5,500 trades on its ether perpetual market represent wash trading designed to inflate volume metrics. The CFTC-regulated exchange denies the claims but the pattern raises questions about how US derivatives platforms police self-clearing members and volume-based rebate programs.

• $5,500 trades made up 48%-58% of Kalshi’s ether perpetual volume on four separate days, according to analysis by former quantitative trader Beni.
• $539 million in 24-hour ether perpetual volume stood against only $3.1 million in open interest, a ratio suggesting possible artificial activity.
• Kalshi’s September 16 CFTC filing excludes rebate eligibility for trades under self-matching or wash-trading investigation, giving its chief regulatory officer enforcement discretion.

• $5,500 identical trade size that dominated Kalshi’s ether perpetual tape across multiple days
• 48%-58% of all ETH perpetual volume made up by the single order size on four separate trading days
• September 16 date Kalshi filed updated crypto perpetual rebate terms with the CFTC

Kalshi, the CFTC-regulated exchange running prediction markets and crypto futures since June, now faces scrutiny over trading patterns that may indicate wash trading or collusive activity designed to artificially boost volume. A former quantitative trader first reported by BeInCrypto pulled public trade data from Kalshi’s ether perpetual market and found that a single $5,500 order size repeated obsessively across the tape, accounting for nearly half of all volume on certain days even as the dollar value of actual open positions remained minimal.

One order size dominated 48-58% of ether volume on multiple days

Beni, co-founder of research firm Stealth Neolab and a former quantitative trader, said he counted roughly $539 million in 24-hour volume against only $3.1 million in open interest on Kalshi’s ether perpetual market.

The gap between volume and open interest, which measures the value of positions still held, suggests that most trades were being closed quickly rather than building sustained positions.

“On ETH the exact same $5500 trade size keeps appearing over and over again… it literally made up 48%-58% of ALL ETH PERP volume on 4 separate days,” Beni said in a post on X.

Beni said he saved copies of the trade data before publishing because the records change by the second, making later reconstruction difficult. He added that lawyers are reviewing additional material he collected before he publishes further analysis.

Kalshi claims prediction markets and perpetual rebates were confused in the critique

Kalshi’s head of crypto, posting as IcoBeast, challenged the characterization of the activity, saying Beni had blurred two separate product lines: the platform’s prediction markets and its newer perpetual futures contracts. “All exchanges run rebate and incentive programs to help provide better liquidity on the exchange for traders. CME does it. So does Hyperliquid and Binance,” IcoBeast wrote, defending the rebate structure as standard industry practice.

Kalshi also denied hand-selecting which firms could self-clear trades, arguing that fair access is a regulatory requirement. The exchange filed updated perpetual rebate terms with the CFTC on September 16, setting rebates for self-clearing members at 0.003% of trade value for takers and equivalent maker credits. The same filing explicitly excludes rebate eligibility for trades under investigation for self-matching, wash trading or pre-arranged activity, giving Kalshi’s chief regulatory officer authority to revoke a firm’s rebate status.

CFTC warned in August that volume-based rewards drive artificial trading

CFTC staff flagged the systemic risk in August, warning that steep volume-based rewards can push participants to trade solely to reach targets.

No enforcement action has been announced against Kalshi over these claims. Wash trading, where one party buys and sells with itself to create the illusion of activity, violates US commodities law. In June, Kalshi’s bitcoin perpetual market cleared $1 billion in volume within days, a threshold its prediction markets took 40 months to achieve.

The CCS read. Rebate programs are standard in derivatives markets, but they work only if surveillance detects self-matching before it inflates the reported numbers that market participants and counterparties rely on. Kalshi’s filing suggests internal controls exist on paper; whether those controls are applied retrospectively or only when challenged externally remains the open question for institutional users evaluating counterparty risk.

Beni told followers that additional material reviewed by legal counsel may be published, meaning further specific trade evidence could surface. The CFTC has not announced an investigation, but the pattern and the platform’s own filing excluding rebate-eligible trades under investigation suggest the regulator may be examining whether Kalshi’s self-clearing members have gamed the rebate structure or whether Kalshi itself participated in or knowingly incentivized the activity.