Phantom rolls out Kalshi prediction markets to US users, says it's 'confident and comfortable' amid state lawsuits

Crypto wallet provider Phantom is rolling out Kalshi prediction markets to U.S. users, letting them trade event contracts directly on its app.

The rollout begins Friday, Oct. 23, with access expanding over the coming weeks. Phantom users will need to complete KYC on Kalshi.

The launch comes as states challenge Kalshi's claim that federal oversight protects its event contract offerings from state gambling laws. Asked whether those disputes raised concerns for Phantom, General Counsel Kevin Jacobs said the company was comfortable moving forward. 

"Our perspective is that the CFTC’s jurisdiction here is clear," Jacobs told The Block. "So long as our interaction with these products is consistent with our no-action position, we are confident and comfortable engaging in this activity," he said.

In March, the Commodity Futures Trading Commission issued Phantom a conditional "no action" letter, relieving it from registering as a broker. Then, last month, the CFTC extended that relief to other software providers.

Jacobs said Phantom would comply with state restrictions while the disputes play out, adding that he expects the Supreme Court will eventually have the final say.

Market access and fees

Phantom said it will initially be blocking sports markets in Michigan; sports, elections, politics and entertainment in Nevada; and those plus culture, science and tech, mentions and geopolitics in Washington. Those restrictions could change as their respective cases play out in court.

Kalshi is making its full catalog available to Phantom, with Phantom deciding which markets to display, Max Crowley, Kalshi's vice president of business development, told The Block. Crowley declined to comment on the active state cases.

Users will be able to fund trades with CASH, Phantom's dollar-pegged stablecoin, through their Phantom Cash accounts. Jacobs added that "more ways to pay are coming soon."

Funds move to Kalshi and are converted into fiat for settlement, while cash outs and winnings return to users' Cash accounts.

Phantom quoted a prediction feed of $0.02 per contract, plus a small network fee for moving funds to Kalshi. Users will see a breakdown before confirming a trade or cash-out.

Crowley said he expects the partnership will bring more users to Kalshi, increase liquidity and improve its market data.

Kalshi has recorded more than $291 billion in trading volume this year, according to The Block data. October volume has reached $55.33 billion with nine days left in the month, putting it on pace to surpass September's monthly record of $59.32 billion.