Polymarket–Kalshi Cross-Platform Arbitrage

How It Works Polymarket and Kalshi both list prediction markets on identical or near-identical events (elections, economic data releases, etc.). When the same event trades at materially different prices on each platform, a trader can buy the underpriced side on one platform and sell (or buy the complementary side) on the other, locking in a spread that is profit at resolution regardless of outcome.

Entry/Exit Conditions The bot continuously monitors equivalent markets on both platforms for spread divergence. Entry is triggered when the combined position yields a positive expected value after accounting for both platforms' fees, gas costs on Polymarket (USDC/Polygon), and any withdrawal/deposit friction. The position is held to resolution since early exit requires unwinding both legs.

Verification No performance data is mentioned. The repo is tiny (26KB) suggesting a prototype or scanner rather than a fully production-ready system. No stars or forks indicate limited external validation.

Implementation Notes The primary implementation challenge is maintaining authenticated API connections to both platforms simultaneously and mapping equivalent markets reliably. Kalshi is a regulated US exchange with different API constraints than Polymarket's decentralized CLOB. Capital must be pre-deployed on both platforms to enable rapid execution, tying up liquidity. Settlement timing differences between platforms can create temporary basis exposure.

Risks Markets that appear equivalent may have subtly different resolution criteria, turning a perceived arb into a directional bet. Capital efficiency is low since funds must sit idle on both platforms. Regulatory differences (Kalshi is CFTC-regulated) create asymmetric risk. One platform may halt trading or delay resolution differently than the other.