Kalshi Hits $1B in Perpetual Futures Volume While Big Banks Hold Back

Kalshi's perpetual futures tied to bitcoin and other digital assets exceeded $1 billion in trading volume within seven days of their June launch. The platform is now pursuing regulatory approval to expand its offerings to include contracts linked to gold and silver.

Both Kalshi and Coinbase received clearance from the Commodity Futures Trading Commission to list perpetual futures in the United States, marking a shift from regulatory uncertainty to formal oversight under federal derivatives laws.

Major Wall Street banks are holding off on entering the perpetual futures market, uncertain whether the product represents a sustainable opportunity or a temporary retail trend. They are waiting for trading liquidity, regulatory frameworks, and market infrastructure to develop further before committing resources.

Proprietary trading firms, market makers, and newer clearing firms are expected to be the next wave of participants in the market, filling the gap left by larger institutions.

Perpetual futures account for more than 70% of centralized cryptocurrency exchanges' trading volume, making them one of the largest segments in crypto trading. The products were previously concentrated offshore before U.S. regulatory approval opened the domestic market.

The CFTC's June decision moved perpetual contracts from a regulatory gray area into a formal framework, though any future listings tied to assets beyond currently approved categories will require case-by-case review.

In a July report, Kalshi outlined plans to expand beyond cryptocurrency into derivatives for metals, foreign exchange, and energy markets. The company aims to compete directly with established exchange operators by offering perpetual futures across these asset classes.

Rival prediction market Polymarket was also positioned to enter the space pending regulatory approval.

Industry critics caution that perpetual futures carry substantial risks for retail investors who may not fully understand the products' complexity. Small price movements against a position can result in steep losses, particularly when leverage is involved.

The regulatory approval process now includes safeguards under federal derivatives laws, though concerns about retail participation remain a point of debate.