The Commodity Futures Trading Commission is investigating trading patterns on the Kalshi platform following reports of nearly one million ether perpetual futures trades executed in identical amounts. These transactions, concentrated around the $5,500 price level, accounted for over $5 billion in volume during the past month.
Regulators are currently reviewing the activity to decide whether to initiate a formal enforcement investigation. The trading pattern has raised concerns regarding potential wash trading, which involves transactions that lack genuine economic purpose and may create a misleading impression of market activity.
Kalshi has denied these allegations, stating that hundreds of distinct traders participated in the transactions. The company attributes the repeated trade sizes to market makers maintaining fixed resting orders that were executed by faster traders. Kalshi emphasizes that it employs mechanical blocks against self-trading.
Market participants Jump Trading and Wintermute were identified as being involved in these transactions. Jump Trading stated that it operates for profit, utilizes self-match prevention tools, and does not coordinate its activities with other traders. Kalshi launched its crypto perpetual futures business in May.
