U.S. prediction market platform Kalshi continues to expand its crypto derivatives business. According to Bloomberg, Kalshi has partnered with digital asset custodian BitGo to let eligible institutional clients borrow against Bitcoin ($BTC), Ether ($ETH), and select stablecoins, and use the borrowed funds as margin for perpetual futures trading. The arrangement allows investors to access trading capital while retaining their existing crypto assets, further expanding Kalshi’s services in the U.S. regulated derivatives market.
Kalshi partners with BitGo to manage collateral assets using a triparty structure
Under the partnership, Kalshi Prime, Kalshi’s U.S.-registered futures commission merchant, will provide eligible customers with access to crypto-backed financing. The loans will be provided by Kalshi Katalyst, an affiliate of Kalshi Prime, while the collateral will be held in custody by BitGo Bank & Trust.
The service uses a triparty collateral management structure involving the borrower, the lender, and the collateral manager. Customers can use crypto assets held at BitGo as collateral to obtain a loan, then invest the funds in futures positions on the Kalshi exchange to meet margin requirements for leveraged trading.
Kalshi Prime CEO Jeff Bandman said eligible collateral includes Bitcoin, Ethereum, and certain stablecoins that comply with U.S. regulations under the GENIUS Act. As the lending service gradually expands, Kalshi also plans to bring on more digital asset custody partners.
Publicly available information has not yet disclosed specific details such as loan interest rates, loan-to-value ratios, liquidation terms, or the official launch date, so the actual financing costs and scope of eligibility remain to be confirmed.
Targeting crypto holders with a source of funds that doesn’t require selling their coins
In an interview with Bloomberg, Jeff Bandman said the main goal of the new service is to let investors who hold large amounts of cryptocurrency access the funds they need to participate in futures trading without selling their assets.
He said some investors want to hold on to their Bitcoin positions for the long term while also trading in derivatives markets. Traditionally, they might have to sell some of their crypto assets first and transfer the proceeds to a futures trading account. With collateralized borrowing, these customers may be able to access liquidity directly from assets they already hold.
In addition to large Bitcoin holders, Kalshi is also targeting Latin American businesses that use dollar-pegged stablecoins for day-to-day operations. Bandman noted that crypto-native investors who previously traded on offshore perpetual futures platforms are another group the service hopes to attract.
However, collateralized borrowing still entails risks related to cryptocurrency price volatility, loan repayment, and leveraged trading. If the value of the collateral falls, borrowers may need to provide additional collateral; the actual procedures will depend on the loan terms announced later.
Kalshi expands perpetual futures business to attract traders from offshore platforms
The partnership is also the latest development in Kalshi’s expansion of its perpetual futures business. In May this year, the U.S. Commodity Futures Trading Commission (CFTC) approved Kalshi’s Bitcoin perpetual futures contract. The product subsequently launched in June, allowing eligible U.S. investors to participate in the market through a regulated trading platform.
Unlike traditional futures contracts, which have expiration dates, perpetual futures have no fixed settlement date. Traders can hold positions continuously as long as they meet margin and other trading requirements. Kalshi has since expanded its product range to include other financial assets and continues to seek regulatory approval to launch more perpetual futures contracts.
Meanwhile, online brokerage Webull announced on October 20 that it expects to offer perpetual futures services to eligible U.S. customers through Kalshi’s trading infrastructure starting in November, initially focusing on Bitcoin and other crypto assets.
As perpetual futures products and crypto-backed financing services become more widely available, Kalshi is seeking to attract crypto investors who have traditionally used offshore trading platforms. However, whether the new service will gain broad adoption will depend on borrowing costs, collateral management terms, and the range of customers who are ultimately eligible.
The article “Meeting Futures Margin Needs! Kalshi Teams Up with BitGo to Launch Crypto-Backed Lending Service” was first published by “Crypto City”