Kalshi Reverses Policy on Unpaid NFL Winning Predictions After User Backlash

Prediction market operator Kalshi has responded to online criticism over the platform’s decision not to pay out winners on certain NFL regular-season markets. After initially refusing to pay out on winning trades, the company now claims it has settled the markets correctly.

The company stated that the markets were mistakenly closed early and, instead of paying out the would-be winners, reimbursed all trades on the affected markets. In a change of policy, a Kalshi spokesperson informed CasinoBeats, “Everyone has been paid in full, including winnings.”

Why Were Users Angry at Kalshi?

Users complained to Kalshi about markets being incorrectly settled. One example was in the market, “San Francisco Wins This Season?“

A user complained that their successful prediction on the team to record over 10.5 wins was not paid out. San Francisco recorded its 11th win of the season on December 22. They went on to win again on December 29, before losing their final game, and ended the season with 12 wins.

The Kalshi market appeared to have settled normally. It indicated the correct results and showed that the timeline and payout had been concluded. For some reason, the payout date is listed as January 14, even though it is actually January 7.

In a thread on X, the user highlighted posts on Discord showing they had a $215 trade on San Francisco over 10.5 wins, which settled at $0 on December 22. They then contacted Kalshi through Discord, asking, “Will I not be paid out the result of the position?“

A Kalshi staff member replied, “Correct, the position received a reimbursement, that’s the final result on the matter.”

As the user refused to accept this outcome, another Kalshi staff member added, “I understand the frustration. These markets were erroneously determined early so everyone was reimbursed cost plus fees. I’m happy to take your feedback to the team that handles these.”

While the reimbursement was a good result for all those who made incorrect predictions on San Francisco’s total wins, anyone who successfully predicted over would have been left out of pocket. In total, $309,283 was traded on the market.

In the end, Kalshi had to take a loss on this market, sacrificing its usual fees and paying out winners from its own funds rather than those of other users.

Another user in the thread claimed, “This is not the only NFL market they did this for either.” It is unclear how many markets were settled erroneously. When contacted, Kalshi did not provide further details but stated that the issue was resolved quickly on their end.

Kalshi Trading Volume Explodes During NFL Season

Kalshi expanded its NFL markets this season following the popularity of its Super Bowl market. The platform has experienced a surge in trading volume, recording over $2 billion during the final week of the NFL regular season.

The company posted on X that this puts it on course for $100 billion in annual trading volume, although the final games in the NFL season traditionally attract far more bettors than most weeks during the year.

With the expansion of football markets this season, sports account for more than 90% of the total trading volume. Several partners now offer Kalshi’s markets through their trading platforms, including Robinhood, Coinbase, Phantom, and PrizePicks. The platform has also signed deals with major media companies, including CNN and CNBC, to expand its reach.

Legal Challenges Grow Amid Expansion

The expansion has been met with opposition from state gambling regulators who claim the platform is offering unlicensed sports betting. Kalshi disputes this claim in a growing number of court cases.

Kalshi initially had success in fighting legal battles against states that had issued cease-and-desist letters. It secured temporary restraining orders that have allowed it to continue operating across all 50 states.

Judges, however, have been less favorable to the company in more recent rulings. In Nevada, for example, a judge dissolved his initial injunction.

There has been no definitive ruling that has compelled the company to withdraw from a state, but if users also become frustrated with the way the platform operates, then it could become more difficult to secure a legal status.

The decision to pay out all winning trades on the NFL markets may be a little costly in the short-term, but it is likely to pay off in the long run. If more users show faith in prediction markets, then expansion looks inevitable as states continue to debate whether to legalize online sports betting or not.