In a recent analysis of trading activity on Kalshi, a regulated exchange that offers a range of derivative products, a striking pattern emerged in the volume data for two of the most popular perpetual contracts: Bitcoin (BTC) and Ether (ETH). The investigation, conducted by the cryptocurrency news outlet CoinDesk, uncovered that a handful of unusually large and repeatedly occurring trades dominate the reported volume for both assets, raising questions about the representativeness of the numbers and the underlying market dynamics. Kalshi, which is known for its focus on event‑driven contracts and operates under the oversight of the U.S.

Commodity Futures Trading Commission (CFTC), has been expanding its catalogue of crypto‑related products. Among these, the perpetual contracts for Bitcoin and Ether have attracted particular attention because they allow traders to maintain exposure without a fixed expiry date, mimicking the behavior of spot markets while offering leverage.

Perpetual contracts are typically expected to generate volume that reflects a broad base of participants, ranging from retail investors to institutional players. However, the data sampled by CoinDesk paints a very different picture.

For the Ether‑perpetual market, the analysis revealed that a single trade sized at $5,499 accounted for an astonishing 57 percent of the total volume captured in the sample set. In other words, more than half of the trading activity recorded could be traced back to one specific transaction.

This concentration is highly unusual in a liquid market, where volume is normally dispersed across thousands of individual orders of varying sizes. The presence of such a dominant trade suggests that the overall volume figure may be artificially inflated or, at the very least, not indicative of genuine market participation. The situation is similarly skewed in the Bitcoin‑perpetual market.

Here, two recurring trade sizes—$2,500 and $5,000—were found to make up 54 percent of the sampled volume. These trades appeared repeatedly throughout the observation period, implying that a small number of participants (or perhaps a single algorithmic strategy) were repeatedly executing the same order sizes. While repeated trade sizes are not inherently problematic, the fact that they together constitute more than half of the volume raises concerns about the depth and diversity of the order flow.

Several potential explanations can be offered for this phenomenon. One possibility is that market makers or liquidity providers on Kalshi are using standardized order sizes to manage their exposure efficiently.

By breaking down larger positions into uniform chunks, they can more easily balance their books and hedge risk. However, if these standardized orders dominate the volume, it may indicate that the exchange’s order book is heavily reliant on a few large participants rather than a broad community of traders. Another plausible scenario involves the presence of a single large trader or a coordinated group of traders employing a systematic strategy that repeatedly places the same order sizes. This could be part of a market‑making algorithm that seeks to capture the spread, or it might be a hedging activity linked to positions held on other platforms.

In either case, the repetitive nature of the trades would lead to a concentration of volume that does not reflect a wide‑spread interest in the underlying asset. A third, more speculative explanation is that the volume figures have been artificially boosted through wash trading or other forms of market manipulation. Wash trading involves a trader simultaneously buying and selling the same asset to create the illusion of activity, thereby attracting other participants or meeting exchange listing requirements.

While there is no direct evidence of such wrongdoing in the Kalshi data, the disproportionate impact of a few trades on overall volume certainly warrants further scrutiny by regulators and market observers. The implications of these findings are significant for several stakeholders.

For investors, inflated volume numbers can be misleading, suggesting a level of liquidity that may not exist in practice. Traders relying on volume as a proxy for market depth might underestimate slippage risk or overestimate the ease of entering and exiting positions. For the exchange itself, a reputation for transparent and robust trading activity is essential to attract new users and maintain regulatory compliance. If the market perceives that volume is being artificially inflated, it could erode confidence and hamper growth.

From a regulatory perspective, the CFTC and other oversight bodies are likely to monitor such patterns closely. The agency’s mandate includes ensuring that derivatives markets operate fairly and that participants are protected from manipulative practices. Persistent volume concentration in a small number of trades could trigger investigations into whether the exchange’s reporting mechanisms are accurate and whether any participants are violating anti‑manipulation rules.

Looking ahead, several steps could be taken to improve the situation. Kalshi could enhance its data transparency by publishing more granular trade‑by‑trade information, allowing analysts to verify the distribution of order sizes and identify any outliers. The exchange might also consider implementing limits on the frequency or size of identical orders to prevent a single participant from disproportionately influencing volume statistics.

Additionally, encouraging a broader base of market participants—through educational initiatives, reduced fees for smaller traders, or partnerships with institutional firms—could help diversify the order flow and reduce reliance on a handful of large trades. In conclusion, the CoinDesk analysis shines a light on an atypical characteristic of Kalshi’s Bitcoin and Ether perpetual markets: a small set of large, repetitive trades dominate the reported volume. While there are legitimate reasons why such a pattern could arise—such as market‑making strategies or liquidity provision—the concentration raises important questions about market depth, transparency, and potential manipulation. Stakeholders, ranging from individual traders to regulators, would benefit from greater visibility into the underlying trade data and from measures that promote a more balanced and representative trading environment.

Only with a diversified and genuinely active order book can the perpetual contracts on Kalshi fulfill their promise of providing reliable, liquid exposure to the world’s leading cryptocurrencies.