We’re pleased to share that Phantom is beginning to roll out prediction markets to users in the United States, with access expanding over the next few weeks. We sought our CFTC no-action relief earlier this year with this product in mind, and it reaches users through our first US integration with Kalshi.
How we got here
Much of the CFTC's introducing broker framework was not fit for purpose for a non-custodial front-end interface like Phantom. In order to offer this regulated product to our US users, we asked the CFTC whether and under what conditions a non-custodial interface could connect people to a registered exchange without registering as an introducing broker itself.
In March, CFTC staff issued Staff Letter 26-09, confirming through no-action relief that Phantom would not need to register as an introducing broker to offer users access to regulated markets, subject to certain conditions. Phantom became the first passive software provider to receive this relief.
When the relief was announced, we hoped our engagement would help shape a framework that benefits the industry as a whole. In September, the CFTC granted industry-wide no-action relief under the same conditions to similarly situated software providers. We're proud to have done the groundwork that others can now build on, and we're grateful to CFTC staff for engaging with our inquiry and working through it with us in good faith.
How it works
Phantom’s US users can verify their identity and trade prediction markets without leaving the Phantom app. Behind the scenes, a secure third-party service collects and stores users’ identity information. Kalshi, a CFTC-registered exchange, approves and holds users’ trading accounts, and executes the trades they submit using Phantom.
Phantom's self-custody stack was custom built to allow people to hold and control their own assets, years before prediction markets or CFTC relief were part of the picture. Building it that way is, in part, what made this launch possible.
Self-custody has long been viewed as a trade-off: users get more control, but the products built on top are limited. This launch shows what’s possible with self-custody and passive software. We’ll keep working with regulators to ensure users can access the markets they want to trade, and that self-custody software is regulated for what it actually does.
“Phantom did the regulatory work up front, and it’s a model for how prediction markets can reach more people. We’re excited to bring Kalshi’s CFTC-regulated markets to Phantom’s US users, so they can trade on real-world events without leaving the app.”
Phantom is not registered with the CFTC. Prediction markets offered by KalshiEX LLC. Markets subject to availability in certain jurisdictions.
