“kalshi's claim of neutrality dissolves when retail bets face a built-in 3.4% loss to market makers”
Isaac Rose-Berman dissects Kalshi's claim that as an exchange rather than a bookmaker, it has no stake in whether users lose. Through a detailed walkthrough of maker-taker fees, adverse selection and the zero-sum structure of prediction markets, he argues the business depends on ordinary users systematically losing to sophisticated market makers just as surely as any sportsbook. A coin-flip bet that should be fair becomes a 3.4% expected loss after fees.
Some technical background helpful
Platforms mentioned: Kalshi, Polymarket, Coinbase, Robinhood