Kalshi pulls ahead as Polymarket volume falls after World Cup

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Polymarket market share shrinks

Highlights

Polymarket weekly volume fell 56% from its June peak.
Kalshi recorded a smaller 25% decline over the same period.
Kalshi now controls about 90% of short-term crypto prediction trading.
Polymarket is changing its crypto settlement model to regain traders.

Combined weekly trading volume across Polymarket’s international and U.S. exchanges fell 56% from June’s record high by the end of July, compared with a 25% decline for Kalshi, according to Bloomberg. The pullback followed a World Cup trading boom that drove tens of billions of dollars in activity across sports-related contracts before demand cooled sharply once the tournament ended.

Kalshi gains as Polymarket slows

The post-World Cup decline has exposed a deeper problem for Polymarket: it is losing market share even outside the seasonal slowdown. Traders have increasingly shifted to Kalshi as Polymarket works through problems tied to an exchange infrastructure upgrade and a gradual rollout in the U.S.

Polymarket has tried to rebuild activity by offering liquidity incentives, launching referral programs and experimenting with parlay-style contracts. Those efforts have yet to reverse the broader decline.

Kalshi, meanwhile, has expanded more aggressively into short-duration crypto markets and combination bets. Its 15-minute cryptocurrency contracts have become one of the fastest-growing areas on the platform, while its parlay business has also helped lift overall trading volume.

Crypto markets become the next battleground

Short-term crypto price contracts are becoming increasingly important to both platforms. These products let users bet on whether Bitcoin or another asset will finish above or below a reference price over a brief window.

Polymarket initially found strong demand for five-minute crypto contracts, but questions emerged over how some bets were settled. Research from Stanford University found that large trades on external crypto exchanges could influence the reference price shortly before contracts expired.

Polymarket recently switched to time-weighted average pricing, the model already used by Kalshi. The change is intended to reduce the impact of short-lived price moves and improve confidence in contract settlement.

Kalshi has already built a significant lead in this category and is extending the model to other assets, including gold and silver.

The rivalry moves beyond sports

The slowdown matters because prediction markets cannot rely on major sporting or political events every month. Platforms need products that generate consistent trading activity during quieter periods.

Valuations show how much is at stake. Polymarket is reportedly seeking a valuation of around $20 billion, while Kalshi was valued at $22 billion in May and is seeking about $40 billion in its next financing round.

Polymarket still has advantages, particularly its blockchain-based international platform and strong recognition among crypto traders. Kalshi faces its own challenge from legal disputes with U.S. states over whether some event contracts should fall under gambling regulation.

For now, however, Kalshi is converting the post-World Cup slowdown into market-share gains, while Polymarket is being forced to fix product and infrastructure weaknesses before the next major wave of prediction-market demand arrives.

Earlier, we reported that Kalshi taps Nasdaq to strengthen prediction market surveillance.

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