Are Prediction Markets Destroying Society? I Asked the Kalshi CEO
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What is Kalshi and how do prediction markets work?
how do you prep for these kinds of conversations comms writes like a small brief I mean I just read it what's the question you think that your team Elizabeth doesn't want me to ask you today this is an interesting question what's the question I at least want to be asked I don't know
Should I ask Elizabeth? Maybe we should. Elizabeth, what's the question Tarek Elise wants to be asked? What do you think of the polymarket CEO? I have that question. We'll just watch you fuck it up in real time. All right, let's see. Smart girl. Dumb questions. What's up with prediction markets? And does their very existence signal the end of society? This is Smart Girl Dumb Questions. I'm Naeem Arraza. And today I'm with Tarek Mansour, the 30-year-old CEO and co-founder of Kelshi.
Hi, Tarek. Thanks for having me. Thank you for being here. Explain what Kalshi is. Give us the high level. We're the world's largest prediction market, and prediction markets are very simple. The easiest way to think about them is they're like the stock market, but you're not buying and selling shares of a company. You're buying and selling shares, yes or no shares, and whether an event is going to happen or not. A simple question that people relate to or understand.
And you can bet on everything on Kalshi, almost everything. Almost. I mean, almost. Almost everything. Very important. The almost is very important. The 2028 presidential lineup, the NBA playoffs, the World Cup, the U.S.-Iran deal, Strait of Hormuz opening date, or how much traffic is going to go through, whether Taylor Swift is going to meet the Pope. Who the hell cares about Taylor Swift and the Pope meeting? Who cares about Taylor Swift? And the Pope meeting. I don't know about that. It's like a weird intersection of the Venn diagram. I don't know. I mean—
What is the single biggest prediction an investor has made on Kalshi? Like what's the size of that? I mean, there are obviously institutional investors that do like tens of millions of dollars in predictions. And I think that there is, and that usually you see them in like, for example, like economic indicators, like will inflation go up or down or will GDP go up? go upward. And they're on Kalshi, like they're placing a bet on the other side of some retail investor. Or like some institution or other. I think of it as a little bit of the market for average people because That's such a motivating tagline in the market for average people. But it is because, I mean, if you look at the top performers, the people that are predicting all these different things and they're doing a great job at it, they're like average people. You would not, it's, you know, small percentage of them went to Ivy League school. Most of them didn't. A lot of them have blue collar jobs. They don't trade options. They don't trade, like, they don't trade in traditional markets because they feel that they're rigged against them. Some of our best traders, top performers, like one of them is,
This guy who lives in Kansas, no experience in financial markets, but can forecast inflation incredibly well. Wow. Is he single? I don't know. I didn't ask him. So these people you're talking about are very different than the kind of headlines that we see. We see Trump's teleprompter guy. We see George Santos. We see the insider trading. He's using the juicy stuff. But on your point about the average investor, it's a really interesting time for you to say this because Truth Social, the platform in which the biggest shareholder is Donald Trump, has just announced that they have a truth API, which will charge people up to $100,000 for early access, milliseconds early access to things like the president's own tweets, truth, socials, posts, whatever they're called. Yeah.
So, how does something like that change your thinking on the average investor? Because that seems like it's going to benefit the institutional investors. I mean, I don't know what that has to do with CalSheet. There's so much that people are trading on. I mean, like, if institutional investors are going to... What do you mean? Wait, sorry. What do you mean you don't know what it has to do with CalSheet? I'll give you an example.
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Chapters
8 chapters
1
What is Kalshi and how do prediction markets work?
0:00–7:16
2
How does Kalshi attract both average users and institutional investors?
7:16–14:32
3
Why does Kalshi prohibit certain “death” or violent markets?
14:32–21:29
4
How does Kalshi handle insider‑trading and market manipulation?
21:29–28:39
5
What are the main regulatory challenges Kalshi faces at the state and federal level?
28:39–35:52
6
How does the company’s fee structure differ from traditional casinos or sportsbooks?
35:52–43:13
7
What role do advisors like Donald Trump Jr. play in Kalshi’s strategy?
43:13–50:16
8
What is Kalshi’s long‑term vision for growth and competition?
50:16–1:00:12