What Is Kalshi? Why Traders Are Leaving Webull and Robinhood for Prediction Markets

by ghall184 · Published January 13, 2026 · Updated January 14, 2026

Over the past few years, retail trading has experienced significant growth. Millions of everyday users jumped into the markets using apps like Robinhood and Webull, trading stocks, ETFs, options, and even cryptocurrencies. But recently, a growing number of traders have begun shifting their attention to a very different kind of platform: prediction markets—with Kalshi leading the charge. So what exactly is Kalshi? Why are some traders leaving traditional brokerages behind in favor of event-based trading?

Let’s break it all down.

What Is Kalshi?

Kalshi is a CFTC-regulated prediction market exchange that allows users to trade on the outcomes of real-world events rather than buying or selling stocks. Instead of asking, “Will this stock go up?”, Kalshi asks questions like:

Will inflation be above a certain level next month?
Will interest rates rise or fall?
Will a specific political or economic event happen by a certain date?

Each market is framed as a yes-or-no question, and traders buy contracts based on what they believe will happen.

If you’re right, the contract settles at $1.00. If you’re wrong, it settles at $0.00.

That’s it—simple, transparent, and binary.

How Prediction Markets Work (In Simple Terms)

Prediction markets function more like event trading than traditional investing.

Contracts usually trade between $0.01 and $0.99
The price reflects the market’s estimated probability
A contract priced at $0.65 implies a 65% chance of the event occurring
You can buy or sell contracts before the event resolves

Your maximum risk and reward are known upfront, which is a major reason traders are drawn to platforms like Kalshi.

How Kalshi Differs From Robinhood and Webull

Traditional trading platforms focus on financial instruments—stocks, options, futures, and crypto. Kalshi focuses on outcomes.

Key Differences at a Glance

Traditional Brokers (Robinhood, Webull):

Price movements influenced by countless variables
Heavy use of technical indicators
Options trading involves complex Greeks
Margin and leverage increase risk
Emotional trading and volatility are common

Kalshi (Prediction Markets):

Binary outcomes (yes/no)
No margin or leverage
Defined risk on every trade
No technical charts required
Trades based on logic, data, and probability

For many traders, this feels more intuitive and less stressful.

Why Traders Are Leaving Robinhood and Webull

1. Simpler Risk Management

On Kalshi, you know your maximum loss before you enter a trade. There are no surprise margin calls, no rapidly decaying options contracts, and no overnight leverage risks.

This simplicity is appealing—especially to traders who have been burned by volatile markets.

2. Less Noise, More Logic

Stock prices are influenced by earnings, sentiment, algorithms, social media, and even rumors. Prediction markets strip away much of that noise.

Instead of guessing how the market will react, traders focus on whether an event will actually happen.

3. No Complex Options Strategies

Many users come to Robinhood or Webull for options trading, only to realize how complex it can be. Greeks, implied volatility, theta decay, and bid-ask spreads create a steep learning curve.

Kalshi eliminates all of that. You’re simply trading probabilities.

4. Macro and News-Driven Opportunities

Kalshi shines during major news cycles—economic data releases, political events, and policy decisions.

Traders who follow:

Inflation reports
Federal Reserve decisions
Economic indicators
Political developments

often find Kalshi better aligned with their interests than traditional stock trading.

5. Psychological Relief

Binary markets reduce emotional decision-making. There’s no watching a stock swing wildly or panic-selling during a sudden dip.

You enter a position based on belief and probability, then wait for the outcome.

For many traders, this feels calmer and more controlled.

Is Kalshi Gambling or Trading?

This is a common question.

While prediction markets may resemble betting, Kalshi operates as a regulated exchange under U.S. oversight. Traders are not wagering against the house—they’re trading against other market participants.

The key difference lies in information efficiency. Prediction markets aggregate collective knowledge, often producing remarkably accurate probability estimates.

Many economists and institutions view them as legitimate financial tools—not games of chance.