Kalshi turns weather into a $1.1 billion market

• Kalshi has partnered with The Weather Company to verify outcomes on its weather and climate prediction markets.
• Kalshi’s weather and climate trading volume has grown 500% year-on-year and is pacing toward $1.1 billion in annualized volume.
• Climate scientists including Michael Mann and Kaitlyn Trudeau warn the bets risk normalizing disaster, as a Ninth Circuit ruling adds legal pressure on Kalshi.

Kalshi has struck a data partnership with The Weather Company to verify outcomes on its fast-growing weather and climate prediction markets, placing the exchange’s real-time odds on the Weather Channel app and weather.com.

The deal, first reported in late August and later covered by The Guardian’s Oliver Milman, lands as climate scientists warn that gamifying heatwaves, hurricanes and drought risks distancing the public from the human cost of a warming planet.

Weather’s big payday

The partnership, announced in late August, gives Kalshi access to The Weather Company’s enterprise-grade forecasting data to settle contracts tied to temperatures, precipitation and other measurable conditions.

In return, The Weather Company will feature Kalshi’s real-time probability data across the Weather Channel app and weather.com, a platform it says reaches more than 330 million people worldwide.

Weather has become one of Kalshi’s fastest-growing categories, with trading volume in the vertical rising 500% year-on-year and pacing toward $1.1 billion in annualized volume, the company said. Kalshi frames the contracts as a hedging tool for businesses, from ice cream retailers tracking cool summers to logistics firms managing rainfall.

Will Brackett, head of partnerships at Kalshi, said:

“Weather is one of the fastest-growing and most crucial categories at Kalshi.”

Kalshi co-founder Tarek Mansour has previously described the company’s broader ambition as turning any difference of opinion into a tradable asset, a philosophy now extending into climate risk.

Traders can wager on how many climate-fueled disasters the US will see this year, how severe coral die-off will be in Hawaii, or how far Lake Mead, the country’s largest reservoir, will fall below record-low levels.

Some markets sit close to active tragedy. Contracts tracking heatwave severity in Phoenix, Arizona, remain live even as officials investigate up to 500 recent deaths in Maricopa County as potentially heat-related.

Polymarket, Kalshi’s main rival, still lists wildfire contracts on its international platform, though US users are barred from them. Kalshi has never offered wildfire markets, citing what it calls perverse incentives.

A moral storm

The expansion into disaster betting has drawn sharp criticism from climate researchers, who argue it trivializes suffering and could distort public understanding of risk. Kaitlyn Trudeau, a climate scientist at Climate Central, lost her grandfather’s home in last year’s Eaton fire and said watching people wager on the blaze was painful to witness.

Trudeau said:

“The dehumanization of these events really concerns me.”

She added that gamifying disasters distances the public from their human toll, and questioned how Kalshi calibrates markets on impacts that, by definition, have not yet happened.

Michael Mann, a climate scientist at the University of Pennsylvania, separately warned that weather and climate wagers could create incentives for bad actors and fuel conspiracy theories about weather manipulation.

A 2023 study led by Moran Cerf, a researcher at Columbia University, found that participating in a climate prediction market raised participants’ concern about the climate crisis, even shifting the views of some who previously denied established climate science. Cerf has since argued the risks outweigh that benefit, describing prediction markets as gamifying disasters while the sector remains largely unregulated.

The Weather Company rejects the gamification framing, describing the partnership as a risk-management tool rather than entertainment. Polymarket makes a similar case, arguing its markets give the public more accurate information during unfolding disasters than it would otherwise have.

Courts close in

The push into weather comes as Kalshi faces mounting regulatory scrutiny across the US. A Ninth Circuit panel ruled last week that states can regulate Kalshi’s sports contracts as gambling, siding with Nevada in a case that gives other states a legal template to follow.

Mike Dreitzer, chair of the Nevada Gaming Control Board, said:

“This completely vindicates what we have been saying all along.”

The ruling follows Kalshi’s earlier Nevada geofencing deadline, a separate Connecticut lawsuit targeting its sports contracts, and an earlier order blocking Kalshi from taking Michigan sports bets.

Jamie Pietruska, an economic historian at Rutgers University, said weather markets may prove a less politically fraught category for Kalshi to defend in court than sports or politics, given the long-held belief that weather cannot be controlled.

It remains untested whether that argument holds up as more states weigh their own enforcement action.

As weather and climate contracts scale toward Kalshi’s $1.1 billion volume target, the sector faces a dual test: winning legal ground state by state, and defending its social license as scientists warn that betting on disasters could blunt public urgency on climate change.