Special Release: Top 9 Quotes from Axios's Interview with Kalshi Founders
On Thursday, Axios published an interview between their Business Editor and author of the Pro Rata newsletter, Dan Primack, and Tarek Mansour and Luana Lopes Lara of Kalshi. The 30-ish minute interview is worth a watch if you have the time, but if not I already watched the whole thing. Here are the top quotes that I thought were the most interesting or noteworthy.
“It’s important to have an unbiased source of information that can decrease the uncertainty about so many events” -Luana Lopes Lara
I agree, that is important. But Kalshi traders are not necessarily unbiased. They are a small subset of Americans to begin with, self selected into the market, and may have selected to trade for any number of reasons.
“We’re making the world a little bit smarter about what is going to happen in the future.” Tarek Mansour
This really reminds me of how Mark Zuckerberg, Jack Dorsey, the Google founders and others would talk about social media and tech companies around the 2005 timeframe. I don’t think people feel the same way about the promise of social media today.
“One of [the products] is designed for customers to lose. That does not exist with prediction markets.” Tarek Mansour
Mansour is comparing the business structure of sportsbooks to prediction markets here. While it is true that sportsbooks only win when you lose, prediction markets win whether you win or lose. So their incentive is to keep you trading. The more you trade (or gamble), win or lose, the better they do.
“Do you do anything to stop people who have lost a lot from continuing to participate?” “We have things like self-exclusion, deposit limits, trade limits, exposure limits” Dan Primack with the response from Luana Lopes Lara
Everything Lara lists is on the customer to engage. It does not sound like Kalshi will push any sort of friction between a user and trading.
“ I think it is 15 or 16% [of our total staff].” Luana Lopes Lara
This was in response to Primack asking about staff dedicated to surveillance. It roughly equates to 24 staff out of a total headcount of 140-150. I suppose percentage-wise its a significant number, but given the number of users, number of markets, and total trading volume it doesn’t seem like enough to me.
“I couldn’t find the CFTC itself having taken action against an individual for insider trading on prediction markets.” Dan Primack
Neither Mansour nor Lara disputed this claim. It’s not on Kalshi that the CFTC hasn’t taken action, but they rely on the entire ecosystem being seen as fair. They should feel like they have a vested interest in the public knowing about cases under investigation and potential criminal referrals.
“I think that right now almost 30% of our traders are actually women. Women are more concentrated in politics and entertainment.” -Luana Lopes Lara
I had not seen that statistic before and thought it was interesting to note as people talk about who is using prediction markets and what they are interested in.
“What’s more likely to happen, Polymarket comes here to the U.S. fully regulated or they allow enough of these sorts of [unsavory] bets that politicians try to get rid of all of you?” Dan Primack; “We hope it’s the first one” Tarek Mansour and Luana Lopes Lara
Neither respondent seemed too concerned that bad actors would spoil the whole party. As Kalshi tries to fight against a narrative of insider trading and gambling run amok, I think it might be worth their time to try and actively encourage everyone to play by the rules. None of the entities in the prediction market space are established enough with the broader public for people to quickly differentiate between Kalshi and Polymarket.
“Whether the Citrini outcome [an AI doomsday prediction] is going to happen in the next few years.” Tarek Mansour; “One of the fastest growing markets on Kalshi right now is actually on the tech layoffs.” Luana Lopes Lara
Primack asked them both to give him one current market on Kalshi that people might not know about but that they are watching. I thought this was an interesting note to end on and kudos to both Mansour and Lara for choosing substantive markets that indicate an actual potential solid use case for Kalshi.
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