Kalshi Faces Wash Trading Allegations Over $539M ETH Perp Volume

By Nynu Jamal

Key highlights:

  • A trader has raised concerns about possible wash trading on Kalshi’s Ethereum perpetual futures contract
  • The platform recorded $539 million in 24-hour trading volume, with only $3.1 million in open interest
  • Beni noted that the latest fee rebate program for perpetual contracts helps traders make repeated trades

Prediction market platform Kalshi is facing fresh scrutiny over its crypto perpetual futures. After the platform’s Ethereum perps recorded an unusually high trading volume, with open interest remaining relatively low, the large gap between the two raised concerns of possible wash trading.

Why is Kalshi’s ETH perpetual trading activity under scrutiny?

Traders have reportedly highlighted unusual trading activity on Kalshi’s Ethereum perpetual futures contract. The concerns come as there was a wide gap between the trading volume and open interest. According to traders, such a gap could indicate possible artificial or wash trading activity.

Notably, quantitative analyst and co-founder of Stealth Neolab Beni took to X to highlight the figures for Kalshi’s ETH perpetual contract (ETH-PERP). “Kalshi fakes their crypto volume, and I can prove it,” stated Beni. According to his post, the contract saw around $539 million in 24-hour trading volume, while the open interest was recorded at merely $3.1 million.

This means that the reported trading volume was about 174 times higher than the open interest, creating a large gap between the two. Thus, the difference raises concerns about the legitimacy of the trading activity, as the gap may come from repeated buying and selling. If the same positions are opened and closed multiple times, it could increase the trading volume without changing the number of open positions.

What is wash trading?

Significantly, wash trading occurs when the same trader continuously buys and sells an asset to make the market look more attractive than it really is. Such repeated moves can move the trading volume higher even if there is little change in the number of open positions.

Here, Kalshi’s Ethereum perpetual futures contract sparks concern about possible wash trading activity due to the massive difference between the volume and open positions. As the trading volume is much higher than open positions, traders point to the possibility of involving repeated trades.

However, the volume-to-open-interest gap alone cannot confirm that wash trading has happened. Kalshi product executive IcoBeast.eth argued against these allegations. He shared a response on X, asserting that the critics misunderstand the workings of Kalshi’s operations. The executive added that the huge difference in the figures may be driven by the way trading activity and positions are recorded on the platform.

Kalshi’s perpetual fee program draws attention amid wash trading claims

In addition to the wash trading claims, Beni also raised concerns about Kalshi’s temporary fee rebate program for perpetual contracts. On September 2, Kalshi submitted the updated version of the program to the Commodity Futures Trading Commission (CFTC).

Under the program, eligible taker fees for crypto perpetuals could be reduced to 0.3 basis points, or 0.003%. Eligible makers could also receive rebates, with a net payment of 0.3 basis points.

According to Beni, these low trading fees could make it easier for participants to repeatedly buy and sell contracts without facing significant fees. This means that such trades could result in high volume, with little impact on open interest.

However, Kalshi’s filing has included specific rules that are designed to prevent its rebate program from rewarding abusive trading. The company stated that the rebates may be reduced if combining different incentive programs would result in traders paying a negative fee on trades.

In addition, the filing has excluded transactions linked to self-matching, wash trading, pre-arranged trading, or other abusive practices from receiving rebates. Kalshi also stated that its Chief Regulatory Officer can remove a participant from the program and take disciplinary action when necessary.

Source:: Kalshi Faces Wash Trading Allegations Over $539M ETH Perp Volume

Updated: September 21, 2026 at 3:42 pm
Tags: ,