Personally, I think Kalshi’s products are net negative for on chain liquidity. Every product they launch pulls trading liquidity off chain rather than onchain.
As a result, new users entering through Kalshi are more likely to remain within a closed, off chain environment instead of flowing into platforms like Hyperliquid or Polymarket or other chains.
The second order effect is that less liquidity and user activity become composable with the rest of crypto. When state lives onchain, other apps can build on top of it, integrate it, and create new products. When state is offchain, those network effects are harder to capture.
Over time, I suspect many successful onchain products could be replicated offchain via Kalshi or others. I’m sure there is enough liquidity onchain for the ecosystem to absorb some of this, but the question is where the marginal user and marginal dollar end up.
If new demand is captured inside Kalshi first, then the capital, positions, and settlement state tied to that demand are less likely to become composable with the rest of crypto.
Maybe that is fine. Kalshi could grow the overall pie and create more awareness for prediction markets and perps broadly. But the risk I’m watching is that crypto’s strongest consumer finance products get validated in the mainstream while the most valuable network effects accrue offchain