Prediction Market Transparency Under Fire: What the ‘Kalshi Lies’ Campaign Reveals About Liquidity and User Trust

A group called FairPredicts has launched an ad campaign in Washington, DC, targeting Kalshi with the tagline ‘Kalshi Lies’. The effort includes billboards mimicking Kalshi’s own marketing and a new website. It arrives ahead of a Senate hearing on sporting integrity and has already drawn responses from Kalshi and DraftKings co-founder Matt Kalish.

FairPredicts describes itself as a nonpartisan market integrity watchdog. It has spent hundreds of thousands of dollars on the campaign. The core claim is that Kalshi misleads users about who they are really trading against.

Ads Mirror Kalshi’s Own Messaging

The ads appeared in Washington, DC, styled like Kalshi’s March billboards. One Kalshi ad declared “We aren’t the house.” A company post on X added that Kalshi is a federally regulated exchange where users trade against other users and that Kalshi makes money on transaction fees, not market settlements.

FairPredicts calls this a lie. Their campaign highlights that users are not trading against their neighbor. They are trading against trillion-dollar market makers.

The visual and messaging mimicry is deliberate. It forces the industry to look at how prediction platforms position themselves to retail users. The timing, just before a Senate hearing on sporting integrity, adds regulatory pressure.

Kalshi Points to Casino Interests

Kalshi spokesperson Elisabeth Diana claimed the group is funded by casino interests. “Smells like a casino-led effort,” Diana stated. “Prediction markets are fair, transparent, and open. Casinos limit winners (unfair), price with algorithms (opaque), and set the odds themselves (closed). FairPredicts or UnfairPredicts?”

Kalshi does not set the odds. It does operate an in-house trading team called Kalshi Trading. The platform also works with institutional market makers that provide liquidity.

Diana defended the model. “Like any financial market, including the stock market, market makers are industry standard because they help bootstrap liquidity. But on most liquid markets, institutional market makers are not a large percent of volume. On Kalshi, it’s about 7 percent or lower.”

This defense leans on standard financial market practice. It also reveals the tension between retail perception and operational reality.

The Data on Concentration and Profits

FairPredicts runs the site KalshiLies.com. It claims that market makers, including Kalshi Trading, Susquehanna, and Jump Trading, are taking the majority of trades. Susquehanna became Kalshi’s first institutional market maker in 2024. Jump Trading took an equity stake in the company earlier this year.

The group alleges that 67% of all profits on leading prediction market platforms are captured by 0.1% of accounts. It adds that fewer than 2,000 users have netted nearly half a billion dollars.

Matt Kalish has joined the criticism on social media. The DraftKings co-founder left the company earlier this year after fourteen years. Since his departure, DraftKings has increased its focus on prediction markets, including launching parlays earlier this month.

Kalish posted that Kalshi has a “very friendly in house market maker called ‘Kalshi Trading’” integrated with the platform. He claims Kalshi provides user-identifying data to market makers, allowing them to cherry-pick bets in a way that resembles how sportsbooks limit winning bettors.

Risk, Counterarguments, and Operational Reality

The campaign raises real questions about disclosure. After eighteen years on bookmaker trading floors I have seen how liquidity providers shape outcomes. Market makers bootstrap volume. That is true on Kalshi and it is true on every liquid exchange. The 7 percent figure cited by Diana matters, yet the profit concentration numbers from FairPredicts suggest a different story at the tail.

Counterarguments exist. Prediction markets are not sportsbooks. They do not set odds or hold the risk in the same way. Transaction fees create a different incentive than the traditional house edge. Still, when a small slice of accounts captures most of the profit, retail users can feel the platform is not what was advertised.

The limitation is clear. Without transparent volume and profit breakdowns that separate retail from institutional flow, the debate stays loud but imprecise. Casino interests may or may not be behind FairPredicts. The structural issue of who captures the edge does not disappear either way.

Prediction platforms must decide how much visibility they give users on counterparty concentration. Opaque liquidity mechanics worked inside closed sportsbook systems. They create friction when marketed as open exchanges.

The Bottom Line

The ‘Kalshi Lies’ campaign puts liquidity mechanics in the spotlight at exactly the moment prediction markets seek broader legitimacy. FairPredicts spent hundreds of thousands to argue that users face professional money far more than peers. Kalshi counters with standard market-making language and a 7 percent institutional volume claim. Matt Kalish adds accusations of data sharing that echo sportsbook limiting practices.

Industry executives should treat this as an early test of narrative control. Transparency on counterparty mix and profit distribution will matter more than clever billboard lines as regulatory scrutiny increases. Platforms that get ahead of these numbers and explain them plainly will hold user trust longer than those who lean only on “we are not the house” framing. The data is on the table. The market will price the credibility gap soon enough.