• Kalshi will list prediction markets on crypto price outcomes (e.g. "How high will ETH get in 2024?").

• The bets will be settled in U.S. dollars, like all others on Kalshi.

• Unlike rival Polymarket, Kalshi can do business in the U.S.

Kalshi, the lone regulated prediction market platform in the U.S., is moving to grab a piece of the crypto action as digital currencies bounce back from a two-year slump.

Starting Monday, the New York-based company will let clients bet on five differentcryptocurrency price outcomes, a company spokesperson told CoinDesk. Examples include when bitcoin(BTC)willreach $100,000and the highest price Ethereum's ether(ETH)willreach in 2024. Additional markets are set to launch on Tuesday.

To be clear: While these bets areaboutcrypto, they will be placedinU.S. dollars, like all other markets on Kalshi. Traders on the platform have bet on questions such ashow many rate cutsthe Federal Reserve will make this year,how many inches of snowwill fall in New York in March, andwho would win the Oscarfor best screenplay.

Kalshi's move into crypto comes at the apparent dawn of a bull market for digital assets, as the launch of bitcoin exchange-traded funds and other factors have sent prices soaring. TheCoinDesk 20 Indexof major digital assets is up nearly 50% this year.

The move also coincides with renewed investor interest in prediction markets, which for decades were relegated to a niche activity and academic hobbyhorse. In December, Bitwise Investments researchersforecasted that "[m]ore than $100 million will be staked in prediction markets as they emerge as a new 'killer app' for crypto" in 2024. Former U.S. President Donald Trump has regularly beenposting screenshots of his favorable odds for retaking the White House on Polymarket, a crypto-based prediction market.

Advocates say prediction markets have a loftier purpose than gambling: By requiring participants to put their money where their mouths are, the argument goes, they revealwhat people truly believe, offering a corrective tofallible polls and pusillanimous pundits.

Typically, prediction markets are framed as yes-or-no questions about verifiable outcomes within a set time period. For example, on Kalshi's "US bans TikTok this year?" market, "yes" shares were trading Sunday at 25 cents, signaling the market saw a 25% chance of a ban before Dec. 31, and "no" shares were changing hands at 78 cents. Each share pays out $1 if the prediction turns out to be correct, and bupkis if it's wrong.

By letting clients bet on crypto, Kalshi is following in the footsteps of a rival prediction market site, Polymarket, which as of Sunday listed nearly40 markets on crypto-related outcomes.

Polymarket is barred from doing business in the U.S. under a settlement with the Commodity Futures Trading Commission. That leaves an opening for Kalshi, which is licensed by the CFTC, to pick up business from U.S. traders who want to speculate on crypto price movements (or hedge positions) without buying or selling crypto.

The agency's imprimatur is a double-edged sword. Kalshi isfighting the CFTC in courtfor the right to list markets asking which party will control each house of the U.S. Congress.

PredictIt, a popular site for (dollar-denominated) election betting, operates in the U.S. under a no-action letter, or special exemption, from the CFTC that restricts the platform's growth and activities. It, too, sued the CFTC after the regulator ordered it toshut down.

Last week CFTC chairman Rostin Benham said that his agency would propose a rule in the coming monthsto establish new regulations for prediction markets.