$5B in Ether Trades Spark CFTC Review of Kalshi Perpetual Futures

The Commodity Futures Trading Commission (CFTC) is reviewing over one million ether perpetual futures trades on Kalshi that occurred in nearly identical amounts, totaling more than $5 billion in volume over the past month. This review comes after an analysis of public data found that more than a third of recent trades were clustered around $5,500.

The cluster has raised allegations of wash trading, which can create a misleading impression of market activity. Kalshi denies these allegations, stating that hundreds of distinct traders participated and the repeated trade sizes came from market makers keeping fixed resting orders in the book, which faster traders repeatedly hit. The company also claimed that self-trading is mechanically blocked and coordinated wash trading is prohibited and monitored.

The CFTC is weighing this activity before deciding whether to open an enforcement investigation. Two firms reportedly involved in these rapid transactions are Jump Trading and Wintermute. Jump said it trades for profit, uses self-match prevention tools, and does not coordinate its activity with other traders. Kalshi launched crypto perpetual futures in May and has since sought regulatory approval to offer similar contracts tied to individual US stocks.