Kalshi Seeks Regulatory Approval for Index Futures and Partners With Cantor Fitzgerald for Institutional Trading

2026-08-19

The BareStory

Prediction market platform Kalshi has filed for regulatory approval to expand its offerings into traditional financial assets, while securing a major partnership to attract institutional investors. On Tuesday, the company submitted a filing to the Commodity Futures Trading Commission (CFTC) seeking to launch perpetual futures contracts linked to equity indexes—specifically a US500 contract tracking the MerQube U.S. Large Cap Index—as well as the industrial metal copper.

The filings represent Kalshi’s effort to transition into a multi-asset financial exchange, according to company engineer Lior Hirschfeld. Perpetual futures, which track asset prices continuously without an expiration date, have historically been traded offshore. Kalshi reported that its initial cryptocurrency-tied perpetual futures reached over $1 billion in notional volume within a week of their May launch. While the competitive threat previously led to stock drops for traditional exchanges and a lawsuit by CME Group against the CFTC, shares of CME Group and CBOE Global Markets rose on Tuesday following the latest filing.

In a separate development on Wednesday, financial firm Cantor Fitzgerald announced it will begin brokering block trades on Kalshi’s event contracts to enable large-scale institutional trading. Susquehanna International Group will partner in the arrangement as a market maker to offer pricing and liquidity. According to Cantor and Susquehanna executives, the move addresses a historical lack of infrastructure for institutional investors to trade at scale on regulated prediction exchanges.

A spokesperson for Kalshi, Elisabeth Diana, noted that Cantor will be permitted to request the design of new markets, with clients expected to show interest in economic indicators, weather, and climate. While retail sports contracts have previously driven Kalshi's growth, the platform has introduced several initiatives this year, including its first block trade in April, to build institutional participation.

Left Perspective

Shielding Retail From Institutional Dominance
Curbing Speculative Financialization Risks
Gambling On Existential Public Crises

Right Perspective

Securing Onshore Capital Efficiency
Engine of Deep Institutional Liquidity
Optimizing Real-World Risk Mitigation

Left Perspective

• Shielding Retail From Institutional Dominance Equitably structured financial markets must prioritize the protection of individual participants from systemic exploitation by high-volume corporate players. By integrating major financial firms like Cantor Fitzgerald and Susquehanna International Group to facilitate large-scale block trades, Kalshi risks transforming a democratic forecasting tool into an arena dominated by institutional extraction. As these powerful market makers gain asymmetric control over pricing and liquidity, retail investors face an unlevel playing field where their capital is vulnerable to sophisticated, well-funded institutional strategies.

• Curbing Speculative Financialization Risks Financial stability is undermined when highly speculative, historically unregulated instruments are imported into the domestic regulatory framework. Kalshi's push for CFTC approval of perpetual futures on equity indexes and copper threatens to introduce the extreme volatility and leverage of offshore trading into traditional asset classes. While a billion dollars in weekly volume demonstrates intense speculative appetite, this activity represents an unproductive diversion of capital into synthetic betting vehicles rather than tangible, wealth-generating economic investments.

• Gambling On Existential Public Crises Ethical economic stewardship dictates that collective societal challenges, such as weather instability and climate change, must be addressed through public policy rather than financialized for corporate speculation. Allowing institutional clients to request bespoke contracts tracking climate indicators turns real-world environmental disasters into gambling instruments for Wall Street. This commodification of ecological risk incentivizes rent-seeking behavior, allowing elite financial actors to profit from the volatility of natural disasters while leaving vulnerable communities to absorb the actual physical damages.

Right Perspective

• Securing Onshore Capital Efficiency Systemic economic resilience is built on repatriating global financial activity and maintaining highly competitive, transparent domestic markets. Bringing perpetual futures contracts—which have historically operated in opaque offshore jurisdictions—under the regulatory oversight of the CFTC strengthens the domestic financial architecture. This transition ensures that the massive trading volumes generated by innovative multi-asset platforms remain within the regulated U.S. financial ecosystem, capturing capital that would otherwise escape to foreign venues.

• Engine of Deep Institutional Liquidity Efficient price discovery and market stability require robust infrastructure capable of attracting and absorbing large-scale capital. Partnering with Cantor Fitzgerald for block trades and Susquehanna as a market maker solves the historical lack of institutional-grade infrastructure on regulated prediction exchanges. By providing deep liquidity and consistent pricing, this partnership reduces transaction costs and minimizes volatility, establishing a mature marketplace where asset prices can accurately reflect real-time economic data.

• Optimizing Real-World Risk Mitigation Economic productivity thrives when businesses possess precise financial tools to hedge against operational risks and protect their balance sheets. Expanding the exchange to support bespoke contracts on weather, climate, and economic indicators provides corporations with invaluable insurance mechanisms to manage unpredictable macro-environmental variables. Rather than viewing these as speculative instruments, institutional participants utilize them to secure supply chains, stabilize corporate planning, and foster broader macroeconomic continuity.

How it may affect me

As a U.S. reader:

• In the short term, you may gain domestic access to new perpetual futures contracts on stock indexes and copper, allowing you to trade assets that were previously only available through offshore platforms.

• In the near term, individual retail traders on Kalshi may face a highly competitive environment and potential volatility as sophisticated institutional players enter the platform with advanced trading strategies.

• Over the long term, you could see improved pricing and reduced transaction costs on prediction markets as large-scale market makers provide deeper liquidity to the platform.

• In the long term, the businesses you rely on may be better able to secure supply chains and stabilize operations by using new climate and economic contracts to hedge against real-world risks.

Kalshi Seeks Regulatory Approval for Index Futures and Partners With Cantor Fitzgerald for Institutional Trading

The BareStory

Left Perspective

Right Perspective

How it may affect me

Read the story at