Kalshi Inc. Chief Executive Officer Tarek Mansour said his prediction market company is looking at additional ways to protect customers who are losing money betting on the platform. Speaking with Emily Chang on Bloomberg's The Circuit, Mansour acknowledged that "irresponsible users is a real worry for any of these types of products." He argued that speculators fare poorly with many products that have recently become popular with retail traders, including options and futures, and said the losses were not stopping Kalshi from talking with regulators about additional safeguards.
"Our message is not, 'Hey, there's nothing to see here,'" Mansour said. "Our message is like, 'Let's regulate it, let's figure out the right guardrails and where there are gaps.'" Prediction markets have faced criticism for opening betting on sports and elections to vulnerable audiences, including recovering gambling addicts and young users. Kalshi, regulated as a financial exchange by the Commodity Futures Trading Commission, is available to almost anyone over 18 in the US. On Tuesday it announced a $2,500 monthly deposit limit for customers under 21, who will be placed into "special accounts" with features designed to curb risky behavior. Mansour said he would be open to regulators raising the age limit to 21.
Marcello Escobar, a 24-year-old fashion designer, said he lost $5,000 on prediction markets. "You'll think it's easy money, and then it'll be $100, $200, and then it just goes down from there," he said. Matt Sarbone, a 26-year-old in estate planning, said easy access was harming his peers. "I know it's affecting my generation bad," he said.
Mansour argued that prediction markets differ from traditional sports gambling because Kalshi is an exchange and does not take the other side of customer trades. "On Kalshi customers lose, they don't lose it to me. They lose it to other customers," he said. Mansour and co-founder Luana Lopes Lara met as students at Massachusetts Institute of Technology. The company is closing a funding round that gives it a $40 billion valuation. Lara said critics have not focused enough on losses retail traders are incurring on other speculative products.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing