"The market offered "yes" or "no" contracts on whether Khamenei would be "out" as the nation's Supreme Leader. On Saturday morning, while rumors of Khamenei's death circulated online but an official announcement had not yet been made, Kalshi was promoting the market on social media. After his assassination was confirmed, many traders who had purchased "yes" contracts assumed they had turned a profit."
"Instead, Kalshi paused the market for review on Saturday afternoon, then ultimately resolved at the last-traded position prior to his killing. This meant that many people who had purchased "yes" trades did not get the payouts they anticipated. Kalshi declined to comment on the incident."
"Derivatives markets in the United States are not legally permitted to offer contracts on assassination. But Kalshi had only added a notice about the carveout to the webpage for the market after the attack on Iran had begun, which meant that some traders did not see it."
Prediction markets experienced significant activity surrounding U.S.-Israel tensions with Iran, with traders placing hundreds of millions in bets on conflict timing and outcomes. Following Ayatollah Khamenei's death, Kalshi faced a major controversy over a $54 million market on whether Khamenei would leave his position as Supreme Leader. While rumors circulated Saturday morning before official confirmation, Kalshi promoted the market on social media. After Khamenei's death was confirmed, traders holding "yes" contracts expected profits, but Kalshi paused and ultimately resolved the market at the last-traded price before the killing. This decision denied anticipated payouts to many traders. Kalshi CEO Tarek Mansour later cited a "death carve-out" in the rulebook, explaining that U.S. derivatives markets cannot legally offer assassination contracts. However, this notice was only added to the market webpage after Iran tensions escalated, leaving many traders unaware of the restriction.
Read at WIRED
Unable to calculate read time
Collection
[
|
...
]