Solana News Today: Kalshi's Hybrid Model Merges Crypto Liquidity with Regulated Prediction Markets

Kalshi, a federally regulated prediction market platform, has launched tokenized versions of its event contracts on the Solana blockchain, marking a strategic shift to attract crypto-native traders and deepen liquidity pools. The move aligns the firm with Polymarket, its decentralized rival, which has long offered on-chain trading of prediction markets. By tokenizing its existing event contracts—spanning political outcomes to macroeconomic data—Kalshi enables users to trade these assets via Solana's blockchain, offering enhanced anonymity and mirroring the functionality of Polymarket's model. The integration leverages decentralized finance (DeFi) protocols DFlow and Jupiter to bridge Kalshi's off-chain order book with Solana's on-chain liquidity, creating a hybrid system that combines regulated markets with crypto-native infrastructure.

The expansion comes as prediction markets surge in popularity, with combined trading volume hitting nearly $28 billion through October 2025, including a weekly record of $2.3 billion in late October. John Wang, Kalshi's head of crypto, emphasized that tokenization taps into the $3 trillion digital asset market, enabling higher trading volumes from crypto users compared to traditional bettors. "If you have a market with no liquidity, then you don't really have a market," Wang stated, underscoring the importance of liquidity for competitive pricing and scalability. The firm's tokenized contracts also allow developers to build third-party front ends, further democratizing access to its liquidity pools.

Kalshi's move intensifies its rivalry with Polymarket, which recently secured a CFTC-issued order allowing U.S. users to return to its platform after a 2022 regulatory crackdown. While Polymarket focuses on decentralized governance, Kalshi maintains its regulated framework, operating 3,500 markets and boasting a $11 billion valuation following a $1 billion funding round led by Sequoia Capital and Andreessen Horowitz. The firm also announced a $2 million builder grants program to incentivize developers to integrate Kalshi's markets into trading terminals, analytics tools, and AI applications, aiming to expand its ecosystem beyond traditional finance.

However, regulatory challenges persist. A recent Nevada court ruling dissolved a preliminary injunction protecting Kalshi from state enforcement, exposing it to potential legal action in the state. The company is appealing the decision while maintaining operations, arguing its CFTC license grants nationwide authority. Despite this, Kalshi's valuation and trading volume have soared, reflecting growing demand for prediction markets amid broader crypto adoption.

With Solana's high-performance blockchain and DeFi infrastructure, Kalshi aims to solidify its position as a hybrid exchange bridging on-chain and off-chain liquidity. As the sector evolves, the firm's ability to attract crypto-native capital while navigating regulatory scrutiny will determine its success in competing with Polymarket and capturing a share of the projected $95.5 billion prediction market by 2035.