A Landmark in Regulated Crypto Trading
Kalshi has become the first CFTC-regulated US exchange in history to offer both Bitcoin and crypto perpetual futures — commonly called "perps." Since launching these perpetual futures contracts, the platform has been generating enormous volume, surpassing $1 billion in trading volume in roughly its first week and continuing to grow rapidly.
This matters because perpetual futures are one of the largest asset classes on the planet today, trading over $90 trillion in volume annually. Until now, essentially all of that activity happened offshore and unregulated. For a US citizen, gaining access to this market through a domestic, regulated venue is a significant opportunity. Bringing perps onshore changes the game in a major way: it introduces legal protections, federal oversight, and — for those entering now — the advantage of being early.
What Are Perpetual Futures?
Perpetual futures let you trade the price of an asset like Bitcoin without actually owning it. They use leverage, and crucially, they never expire.
The fact that perpetuals don't expire is a big reason they are taking off so dramatically. With traditional futures trading, you have to be right in two ways: directionally (for example, betting that Bitcoin will go up) and on timing (predicting when that move will happen). Being correct on timing is far harder than being correct on direction.
Perpetuals remove the timing problem. Because they don't expire, you only have to be right directionally — as long as you are willing to fund the trade and keep it open.
A clear way to frame it: sometimes you have a view on where something is going and by when, but a lot of the time you only have a view on where something is going, not exactly when. The problem with conventional futures is that they force you to take a view on the "when." If you want to hold a position longer than the contract allows, you have to close it out and reopen it, which means paying fees each time. Perpetuals spare you those fees. The result is that they are simpler, cheaper, and more accessible for ordinary consumers.
In practice, you are not buying the underlying asset — you are trading on which direction its price will move. If you think the price is going up, you go long. If you think it's going down, you go short. You open the position, ride the move, and close it whenever you want.
The Two Things That Separate Beginners From Experts
With no expiration dates, the two critical factors that distinguish beginner traders from experts are leverage and liquidations.
Leverage
Leverage amplifies your position in both directions — to your benefit or to your detriment. When you open a position, you deposit collateral, also known as margin. Suppose you trade with $1,000 of margin at 5x leverage. That $1,000 now controls a $5,000 position. The consequence is that a 10% move in the underlying asset becomes a 50% move in your collateral, in either direction. As the saying goes: live by the sword, die by the sword.
Liquidation
If you get liquidated, you lose your position. When a perp falls below its liquidation price — for example, when you are long and the price drops below that threshold — your position is closed automatically.
A valuable feature here is that the platform clearly indicates whether your liquidation status is healthy, at risk, or at very high risk. If you are long, the price begins to correct, and you start drifting toward liquidation, you can always add funds to your position to increase the buffer and push your liquidation risk back to healthy. This makes risk management straightforward and visible.
Funding Rates
The funding rate is the mechanism that allows a perpetual trade to stay open 24/7 and continue indefinitely.
- When the funding rate is positive, longs pay shorts.
- When the funding rate is negative, shorts pay longs.
The funding rate affects you depending on whether you are long or short and on the prevailing market conditions. For example, if the funding rate is negative — meaning shorts are paying longs — that signals that the majority of the market is positioned short. Importantly, this means you can actually get paid to hold a position when the broader market agrees with your direction and the price moves your way. The ability to get paid as the price goes down (while holding a short) is a major distinction from simply owning an asset.
Take Profits and Stop Losses
Take profits and stop losses help you manage when you exit a trade, and mastering them is another thing that separates beginners from pros.
- A take profit locks in your gains automatically once the price reaches your target.
- A stop loss limits your downside, saving you from larger losses if the market moves against you.
Step-by-Step: Getting Started and Placing Trades
Signing Up
To begin, you sign up for Kalshi and complete KYC ("know your customer") verification by providing your ID. Everything is regulated and compliant. Kalshi is well known as a prediction market, but it now offers perpetuals as a separate product.
Perps vs. Prediction Markets
Kalshi offers both products, and the two biggest differences are:
1. Leverage — with perpetuals you have the option to use leverage; with prediction markets you do not.
2. Expiration — perpetuals have no fixed end date, whereas prediction markets always resolve to a yes or no on a specific date.
Example 1: A Market-Order Short on Shiba Inu (SHIB)
Suppose you are bullish on Bitcoin and Ethereum but bearish on smaller coins like SHIB, Doge, or Bitcoin Cash, and you want to short them. With perpetual futures, you can make money when the price goes down.
Taking SHIB (traded as the "KSHIB" perp, which tracks the price of Shiba Inu) as an example, you can view all the basic contract information on the page. There are two order types: market order and limit order. A market order executes immediately at the current price.
For this trade, with an account funded with a bit over $500, the recommended discipline is never to bet the maximum. Without strong conviction in either direction, a limited amount is used — starting at $100 to short SHIB, with leverage set to 1.5x.
Setting the exit parameters: if the price falls about 10% (a downward move, even though declining prices may be displayed in green when you're shorting), the estimated profit would be a little under $15, because of the 1.5x leverage. On the other side, if the thesis is wrong and the price rises sharply — say 50% — the stop loss would sit above the liquidation price, which has to be watched carefully. Setting a stop loss at a 5% upward move means that if the price climbs 5%, the position closes for a loss of only $7.25, because the stop loss got you out early.
Checking the funding rate here: it is negative, meaning shorts are paying longs, which indicates the majority of the market is also short and agrees with the bearish view. It's a risky play, but the goal is to get paid if the price goes down. The position size was then changed to $50, and the short was opened.
After opening, you can review your positions — the SHIB short alongside a Solana long opened earlier — as well as your current orders (none open), your history showing the take profit and stop loss, and your liquidation risk (a very healthy short, since the price had barely moved after opening). All of these can be adjusted in real time: you can close the position at any time, buy more at any time, or modify your take profit and stop loss instantly if your information or thesis changes.
Example 2: A Limit-Order Long on XRP
Limit orders are often the preferred choice because they let the price come to you, rather than forcing you to trade at the current price as a market order does.
With XRP trading around $1.21, the plan is to go long only if the price can break back above a recent local high of about $1.2272. To play it ultra-safe, the limit price is set at $1.20299 — the long only triggers if the price reaches that level. The position size is $100. Leverage can be slid between 1x and 2.7x; 2x is chosen here.
It's also noted that there are 0% fees for a limited time, available specifically to this audience for those who sign up to try the platform.
For exits: switching the chart to a weekly view shows significant sell pressure where sellers tend to step in, so a take profit is set around a 5–6% increase — treated as an easy scalp. The stop loss is then moved up so that the position only stops out if the price falls about 4%, reflecting a more risk-averse approach. The beauty of a limit order is that the entire trade only activates if the price first comes down to the chosen entry point. The long was then opened.
Closing Thoughts
Kalshi's perpetuals are 100% CFTC regulated, which is a key advantage of this onshore venue. The core skills to internalize are understanding leverage and liquidations, watching funding rates, and disciplined use of take profits and stop losses — while always doing your own research and trading within an amount you're comfortable risking.
