Kalshi Could Roll Out Casino-Like Product

Although Kalshi, a prediction markets operator, hasn't yet taken over the sports betting business, it may already be considering a move into the iGaming industry.

According to Eilers & Krejcik Gaming (EKG), Kalshi might be considering a "casino-like product" that, if developed, would represent a form of iGaming venture. Because it offers larger margins and better profitability than sports betting, that type of wagering appeals to operators. The total addressable market (TAM) for iGaming is greater than that of online sports betting when measured by gross gaming revenue (GGR).

"The opportunity is hard to ignore: we size U.S. iCasino at a ~$100bn 50-state GGR TAM, yet only ~12% of adults have access today (vs. ~62% for OSB),” observes EKG.

Only seven states currently allow iGaming: Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, West Virginia, and Connecticut. A related law was defeated earlier this year in Indiana, and six states debated similar legislation last year, but those efforts were unsuccessful.

Regulators Watch Kalshi Casino's Aspirations

Kalshi is involved in numerous state-level legal disputes nationwide, partly because it maintains that it does not provide sports betting and, therefore, does not own a gaming license in any state.

This could mean that the company's casino-related products won't be similar to those that BetMGM, DraftKings, and FanDuel now provide in the iGaming states where they operate. In other words, if Kalshi ever offers online slots or blackjack, it may be a long time off. The regulatory landscape may play a significant role in Kalshi's aspirations for unconfirmed iGaming.

According to EKG, the aforementioned synergies "make casino look like a massive opportunity but the potential pushback from regulators, courts, and Congress could be significant."

Furthermore, there is not much hope for the growth of regulated iGaming in the United States. It currently seems extremely improbable that any state will permit that type of betting when 2025 comes to an end, and it is thought that this will also be the case the following year. According to experts, Florida will be the only state to allow iGaming before the end of 2027.

How Kalshi Casino Might Appear

The company could leverage its established competencies in yes/no markets that resolve in a day or a matter of hours, which would feed into the craze for zero days to expiration (0DTE) trading that so many younger market participants embrace, even though Kalshi hasn't publicly confirmed it's considering iGaming, much less teased a product.

“Kalshi already offers hourly markets on economic indicators, as will the forthcoming product from FanDuel/CME group,” concludes EKG. “As such, it might not be a huge leap to move to shorter timeframe resolutions—and further ramp up the pressure on OSB operators.