US-based prediction markets platform Kalshi will allow certain clients to post cryptocurrencies as collateral for leveraged perpetual futures positions under a new arrangement with digital asset custodian BitGo. Customers of Kalshi Prime, the company’s US-registered futures commission merchant (FCM), will be able to borrow against digital assets held at BitGo and use the proceeds to fund margin positions on futures traded on Kalshi’s main exchange.
How the tri-party structure works
The arrangement uses a tri-party collateral management model, which typically involves three parties: a borrower, a lender, and an agent that handles the collateral. Loans will be provided by Kalshi Katalyst, a lending affiliate of Kalshi Prime, and secured against assets deposited at BitGo Bank & Trust.
Eligible collateral will include Bitcoin, Ether, and stablecoins considered compliant with the US GENIUS Act, according to a company official. Kalshi expects to add other custodians to its network over time.
The stated aim is to let customers remain in crypto rather than converting their holdings to fund margin. The company cited examples such as investors who prefer not to exit Bitcoin positions and a Latin America-based business that relies on USD-denominated stablecoins for its operations.
Expanding the perpetual futures offering
The collateral arrangement builds on Kalshi’s recent move into perpetual futures, contracts that have no expiry date. Earlier this year, the company began offering perpetual futures tied to gold, silver, and cryptocurrencies. It has also sought regulatory permission to list perpetual-style products linked to oil and US stocks.
On the clearing side, Kalshi Klear, the company’s clearinghouse, applied to the US Commodity Futures Trading Commission (CFTC) last month to offer margin on select event contracts. Taken together, these steps point to Kalshi extending its activity beyond event contracts into a broader range of leveraged derivatives within the US regulatory perimeter.
Targeting crypto-native traders
Kalshi expects the arrangement to make its platform more appealing to crypto-native trading firms and individuals with large digital asset holdings, often described as ‘whales’. This is a segment where the US-regulated exchange may face a structural disadvantage compared with Polymarket, an offshore, blockchain-based prediction market.
According to Kalshi Prime Chief Executive Officer Jeff Bandman, the product was designed with digitally native, active customers in mind, including those who may already trade perpetual futures on unregulated offshore venues. Since its development, however, additional use cases have emerged beyond that initial audience.
The arrangement positions Kalshi to compete for crypto-holding traders by combining on-exchange leverage with regulated custody and lending, an approach that differs from the offshore model used by some competitors. The addition of further custodians would broaden the range of entry points for clients seeking to use digital assets as margin collateral.
