Odd Lots: Tarek Mansour on Kalshi’s Plan to Create Markets in Everything
Podcast: Odd Lots by Bloomberg
Hosts: Joe Weisenthal & Tracy Alloway
Guest: Tarek Mansour, CEO of Kalshi
Date: October 1, 2025
Recorded: Live at Chicago’s Untitled Supper Club
Episode Overview
Bloomberg's Joe Weisenthal and Tracy Alloway host a timely and insightful conversation with Tarek Mansour, co-founder and CEO of Kalshi, an exchange designed to create regulated markets on the outcome of real-world events—otherwise known as prediction or event markets. The discussion covers the regulatory battles that made Kalshi’s platform possible, the differences between prediction markets and gambling, the role of liquidity and market makers, future ambitions for creating markets on everything (including company events and perpetual futures), and the social implications of making these markets widely accessible.
Key Discussion Points & Insights
1. Why Prediction Markets Are “Having a Moment”
- South Park Coverage: Opening with humor, Mansour reacts to a South Park episode satirizing prediction markets, even joking that it reproduced bugs from Kalshi’s app.
“They even had some of the bugs we have in the app. It’s like it was unbelievable… there’s a few parts that I disagree with, but…we enjoyed it.” — Tarek Mansour [02:07]
- Historical Obstacles: Prediction markets have existed for decades, but U.S. regulatory barriers, especially legality, kept them niche or shut down legacy examples like Intrade.
“The elephant in the room was regulatory. It was illegal.” — Mansour [03:32]
- Regulatory Turning Point: Kalshi spent years tackling regulation. A pivotal lawsuit against the U.S. government allowed them to launch legally—a watershed for the space.
“That lawsuit…is probably what the turning point is for these markets. Like this is when we won that—the institution…when everything changed, I think.” — Mansour [05:00]
2. On-Chain vs. Regulated (Off-Chain) Markets
- Comparing with PolyMarket: Hosts ask if on-chain, offshore platforms (like PolyMarket) could disintermediate regulation.
“On chain doesn’t mean illegal…for this to go mainstream, you should avoid a VPN…” — Mansour [07:02]
- Legitimacy & Liquidity: Mansour asserts only regulated, mainstream markets attract institutions, transparency, and scalable liquidity. While on-chain markets exist, Kalshi has outpaced them in real trading volume.
3. Building a Market on Real-World Events
- How an Event Contract Is Born:
- Traditional commodities have endless life; event markets are “dynamic,” rapidly responding to trends or news—contract creation has gone from 18 months to 30 minutes.
“My mental model…an idea comes from a user, the news, a trend. Then there’s a listing…and making it liquid and active.” — Mansour [09:00]
- Regulatory Process: Expansion is often via self-certification (with the CFTC increasingly in the loop), allowing faster listing if events are similar to prior approved ones.
4. Sports Markets: Betting, Trading, or Gambling?
- Dominance of Sports: Sundays see massive volume spikes, with NFL far outpacing any other events—though cultural and political markets are growing.
“[On NFL Sundays]…the volume is massive…like asking, on election day, what was the volume?” — Mansour [13:40]
- Betting vs. Trading vs. Gambling:
- Mansour resists calling it gambling; sees value in speculation if coupled with transparent pricing.
- Legal and ethical questions differ—CFTC regulates Kalshi federally.
“I would say two things. There’s the legal question and…is this good for society? …Our approach has always been legal and regulate first.” — Mansour [14:15]
- He draws a line between “market-based models” (open, transparent, peer-to-peer) and classic gambling (opaque, house-advantaged).
“I think a market-based model…is better…Result: the percentage of people that lose on Kalshi is closer to 50/50. That’s just not the case in a traditional sportsbook.” — Mansour [16:45]
- Role of Marketing: Jokes about the “breaking news” ad—legally, Kalshi is accessible in all 50 states, which is newsworthy [17:58].
5. Market Makers, Liquidity & Institutional Participation
- Pricing and Operations: Market makers are vital to start markets (provide initial liquidity), but organic participant liquidity increases as markets mature.
“The more successful a market becomes…the lower the percentage of market makers.” — Mansour [21:51]
- Market Maker Obligations: No blanket obligation; incentives (e.g., fee rebates) are tied to specific commitments per market.
“If you make [markets] on the Fed market…you put 75,000 contracts up on each side within like 3-4 cent spreads…and get your fees rebated.” — Mansour [26:16]
- Transparency: KT (Kalshi Trading) operates independently, with no information or financial advantages over external market makers.
“KT has absolutely no advantages…other market makers or market participants.” — Mansour [27:57]
- Institutions as Hedgers: While some buy-side and hedge funds use Kalshi for event hedging (NFP, CPI, etc.), volume limits mean “deep institutional” adoption is a few years off.
“The main bottleneck is basically liquidity…for even to care is eight figures, probably 50 to 100 million.” — Mansour [30:28]
- Broker Integration: Future vision involves seamless access through prime brokers or retail brokers like Robinhood—mirroring mainstream options trading.
6. Vision: Markets for Everything
- Perpetual & Company Event Markets: The long-term ambition:
“Anything that has…a difference of opinion should have a mechanism to resolve that quantitatively.” — Mansour [24:22]
- Regulatory Issues: SEC/CFTC division makes company futures complicated. If resolved, it unlocks vast possibilities (e.g., private company, SpaceX, or perpetual futures).
- The next step(s) may be imminent: “Maybe now in this environment…we’ll figure it out on Monday.” [25:41]
7. On-Chain Future
- Recognizes the potential and future integration of on-chain settlement/clearing for transparency and innovation—provided regulatory barriers ease.
“I do agree…in the next four or five years you see companies…leaning in [on-chain]. We’re pretty excited about it.” — Mansour [41:50]
8. Social Utility & Regulation
- Free Market Belief: Mansour argues for broad user autonomy, with fair rules and basic protections—opposing paternalistic regulation.
“I’m a strong believer that…the job of regulators should not be dictating what people do with their money…financial regulators…I think have taken it too far.” — Mansour [36:02]
9. Kalshi’s “Battle-Tested” Status and Emotional Journey
- Vindication after Regulatory Struggles: Describes the existential risk of years fighting lawsuits, losing half the team, and doubling down to sue the regulator—now seeing it pay off.
“There was pretty big time vindication…October 7th, the day we won the election lawsuit…was probably the day I felt happiest.” — Mansour [44:30]
- Rapid Growth & New Challenges:
- Company has far exceeded even bullish forecasts post-lawsuit; now focused on scaling, expanding product and broker integration, and maintaining reliability during hyper-growth.
Notable Quotes & Memorable Moments
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On Regulatory Breakthrough:
“We spent…three years and a half…all we did was basically regulatory work…we gotta legalize it.” — Mansour [04:20]
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On Market vs. Gambling:
“You create an artificial risk and…gamble on it. Trading on whether Brexit happened or not, that’s just like a natural risk…” — Mansour [19:42]
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On Social Utility and Regulation:
“People decide what they want…figure out how to do it in a safe, equitable and fair manner…job of regulators should not be dictating what people should do with their money or their lives.” — Mansour [36:02]
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On Kalshi’s Future:
“We want to have markets for everything.” — Mansour [35:53]
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On Winning the Lawsuit:
“We all got shitfaced in the office…then got back to work…three weeks that I worked the hardest in my entire life.” — Mansour [45:20]
Important Segment Timestamps
| Time | Segment/Topic | |-----------|------------------------------------------------------------------------------------------| | 02:05 | South Park episode & popular culture moment | | 03:32 | History and challenge of prediction markets—Intrade story | | 04:20 | Regulatory struggle & Kalshi’s pivotal lawsuit | | 06:22 | On-chain prediction markets vs. regulatory approach | | 08:22 | How a binary event contract gets created on Kalshi | | 12:16 | Volume dynamics: sports vs. political/cultural events | | 14:09 | Is this sports betting? Legal and social distinctions | | 21:51 | Why market makers are needed and how prices are set | | 24:10 | Vision: futures on everything—company, perpetual, customized events | | 26:16 | Market maker obligations and incentivization | | 30:28 | Hedging & institutional use: who participates and why liquidity is key | | 34:25 | Broker integration and the path for large institutions | | 35:16 | Social utility of event markets within financial platforms | | 38:21 | Regulatory technicalities: “CFTC approved” vs. “not banned” | | 39:59 | Kalshi’s vision for on-chain integration and regulated expansion | | 42:12 | Barriers to further growth now: scaling, broker partnerships, new market frontiers | | 43:20 | Emotional impact of surviving challenges (lawsuits, growth, validation) | | 45:17 | Celebration after winning the election market lawsuit; three weeks of rapid scaling |
Conclusion
This engaging live episode offers a candid look at Kalshi’s rollercoaster efforts to create a legal and scalable market on real-world events. Through regulatory victories, a focus on transparency and fair pricing, and a vision that stretches to “markets for everything,” Mansour and Kalshi symbolize the new era of event-driven speculation in finance. Whether it’s Sunday NFL, the latest CPI print, or epic regulatory showdowns, Kalshi aims to price anything people care about—all while betting big on both the future of finance and the power of well-regulated markets.