The Commodity Futures Trading Commission is reviewing an unusual trading pattern on Kalshi's Ethereum perpetual futures market after the Wall Street Journal found close to one million trades clustered around the same $5,500 order size since August. Kalshi denies wash trading, saying the pattern reflects ordinary market-making activity, while Jump Trading and Wintermute, named as participants in the trades, say they do not coordinate with other traders.
The CFTC is reportedly reviewing unusual trading on Kalshi's Ethereum perpetual futures market before deciding whether to open a formal enforcement investigation. The Wall Street Journal reported on September 22 that it had found close to one million trades clustered around the same $5,500 order size since August. The pattern, per the outlet, accounted for more than $5 billion in volume.
What the Trading Data Shows
More than a third of trades in the market over recent weeks clustered around the same $5,500 figure, though Kalshi's public data does not disclose who is behind individual trades. The clustering has drawn allegations of wash trading, the practice of making trades with no real economic purpose to create misleading activity.
Kalshi flatly denies the allegations. According to the report: "hundreds of distinct traders took part", and the repeated order sizes reflect market makers keeping fixed resting orders that faster traders keep hitting.
Kalshi's Response
Kalshi said self-trading is mechanically blocked and coordinated wash trading is barred and monitored. Its liquidity programs, it said, pay market makers for holding orders at set sizes and spreads rather than for raw volume. A separate, temporary program refunds trading fees to qualifying self-clearing members, though never more than what they paid in.
The report identified Jump Trading and Wintermute as among the firms involved in the rapid trades. Jump said it trades its own profit and uses self-match prevention tools, and it insisted that it does not coordinate activity with other traders.
Source: The Wall Street Journal
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