Prediction market Kalshi recorded more than $1.4 billion in trading volume tied to the 2026 US midterm elections by November 3, highlighting the growing importance of event-based derivatives in political forecasting.
The figure, supplied by Kalshi to Fortune, covered contracts linked to congressional control, individual races and other election outcomes. On Election Day, Kalshi’s markets assigned Democrats a 93% implied probability of winning the House of Representatives and a 73% probability of securing the Senate.
The platform’s congressional balance-of-power contract alone attracted approximately $251 million in trading volume. A separate House control market generated more than $181 million, while contracts covering all four possible combinations of congressional control exceeded $112 million.
The activity came as voters determined the composition of Congress for the final two years of President Donald Trump’s term. Market prices subsequently shifted as election results emerged, providing a major real-world test of prediction markets’ forecasting capabilities.
Election Contracts Attract Billions Across Trading Platforms
Kalshi‘s reported $1.4 billion milestone represents a substantial increase in activity compared with earlier election cycles. The Washington Post estimated that nearly $1.9 billion in midterm-related contracts had traded across Kalshi and Polymarket by late November 2.
Its analysis attributed approximately $1.3 billion to Kalshi and $600 million to Polymarket, covering more than 7,000 potential outcomes. The figures use different reporting periods and methodologies, meaning they should not be combined as though they represent separate transactions.
Importantly, trading volume measures the cumulative value of contracts exchanged, not the amount of money deposited or ultimately won and lost. A single contract may change hands multiple times, contributing repeatedly to reported turnover.
The 2026 midterms remain smaller than the 2024 presidential election on Polymarket, which generated more than $3.6 billion in trading activity. Nevertheless, the latest figures demonstrate increasing participation in political event contracts.
Prediction markets generally allow participants to purchase contracts linked to specified outcomes, with prices between zero and one dollar reflecting market-implied probabilities. Prices change as traders respond to polling, campaign developments, voting data and other information.
However, market probabilities are not equivalent to official election projections or certified results.
Midterms Test Forecasting Accuracy and Regulatory Oversight
The November 3 elections provided an opportunity to compare prediction market pricing with actual congressional outcomes. Reuters reported that trading accelerated after polls closed, with more than $4 million wagered within minutes during one particularly active period.
Prices moved further toward Democratic congressional control as results and projections became available. The rapid adjustments illustrated how event markets incorporate new information, although they do not establish that earlier prices were necessarily accurate.
Researchers have found that prediction markets can produce useful aggregate forecasts, but performance varies across events and close contests. Market liquidity, concentrated positions and speculative trading can influence prices independently of underlying probabilities.
The expansion has also intensified scrutiny of election-related derivatives. Kalshi operates as a federally regulated designated contract market under the Commodity Futures Trading Commission. Polymarket maintains a separate US-regulated operation alongside its international cryptocurrency-based platform.
Lawmakers and regulators continue debating whether political event contracts create unacceptable risks involving insider information, conflicts of interest or market manipulation. Supporters argue that transparent trading provides an additional source of information beyond traditional polling.
Critics question whether participants with privileged political knowledge could exploit such markets. For the prediction market industry, the midterms represent both a commercial milestone and a test of credibility. The final assessment will depend on comparing contract prices at specific points before the election with subsequently confirmed outcomes.
The $1.4 billion Kalshi milestone demonstrates substantial demand, but trading volume alone cannot establish forecasting accuracy.