Fee Structures of Prediction Market Operators

Prediction markets differ from traditional sportsbooks in their mechanics. Prediction markets (like Kalshi and Polymarket) operate more like exchanges, where users buy and sell contracts (shares) on event outcomes, often allowing positions to be traded in and out before resolution for profit or loss. Fees here are typically “taker/maker” style on trades, with no inherent “vig” (vigorish or juice—the built-in house edge on odds). This can lead to lower effective costs, especially for active traders, but fees scale with volume and contract prices. Traditional sportsbooks (like DraftKings, FanDuel, and Fanatics) act as bookmakers, profiting primarily from the vig embedded in odds (e.g., -110 lines implying a ~4.76% house edge on even-money bets). They may add flat transaction fees in high-tax states like Illinois to offset costs.

1. Kalshi (Regulated US Prediction Market Exchange)

Kalshi is CFTC-regulated and focuses on yes/no contracts for events like elections, economics, and weather. It’s a limit-order book exchange, so fees reward liquidity providers (makers) vs. immediate takers.

• Trading/Commission Fee: Variable, based on expected profit formula.
• Taker: round up(0.07 × C × P × (1-P)), where C = contracts, P = price ($0-$1).
• Maker: round up(0.0175 × C × P × (1-P)) (charged only on execution).
• No fees on cancellations.
• Effective Rate: Peaks at ~1.75% of premium for takers (at P=0.50, max P×(1-P)=0.25; e.g., $1.75 on $50 premium for 100 contracts). Ranges 0.07-1.75% overall; lower for makers (~0.44%).
• Special markets (e.g., S&P 500) use 0.035 multiplier, halving rates.
• Transaction Fee: None.
• Deposit/Withdrawal Fees: ACH: $0. Debit card deposits: 2%; withdrawals: $2 flat. Wire: $0 deposit (bank fees apply); no wire withdrawals under $500k. Crypto: Third-party fees disclosed upfront.
• Fees on taker side are designed to be ~10% of expected profit but capped low. No settlement fees.
• Effective cost is lower than traditional sportsbooks for hedgers, but scales with imbalance (higher near 0%/100% extreme probabilities).

2. Polymarket (Crypto-Based Prediction Market; US Version Live as of Nov 2025)

Polymarket uses USDC (a US Dollar pegged stablecoin) on Polygon (Polymarket’s open source blockchain infrastructure) for global events (e.g., politics, crypto prices). The original crypto version is fee-free; the new US-regulated exchange (Polymarket US DCM) adds minimal fees.

• Trading/Commission Fee: Crypto version: 0%. US version: Taker: 0.01% (1 basis point) on total contract premium (Contracts × Price). Minimum $0.0001 per trade. Makers: 0% (implied, as only takers mentioned, similar to Kalshi incentivizing liquidity from makers).
• Effective Rate: Crypto: 0%. US: 0.01%—negligible (e.g., $0.005 on $50 premium). No vig; profits from liquidity provision.
• Transaction Fee: None.
• Deposit/Withdrawal Fees: 0% platform-side; intermediaries (e.g., Coinbase, MoonPay) charge gas/network fees (~$1-5 for USDC).
• Notes: US version operates 24/7. No settlement fees. Ideal for low-cost speculation, but crypto volatility adds indirect exchange rate costs. Meaningfully cheaper than Kalshi at this moment in time.

3. Crypto.com Prediction Markets

Crypto.com offers binary prediction contracts on events like sports, politics, and crypto prices, tradable in CRO (native token cryptocurrency of Crypto.com) or fiat. Positions can be closed early; minimum $10 entry.

• Trading/Commission Fee: Flat per-position: Open: $0.02-$0.10 exchange fee (tiered by volume). Close (pre-expiry): Same. Settlement (at expiry): Included in close fee.
• Effective Rate: ~0.1-0.5% on small positions (e.g., $0.10 on $10 contract = 1%, but scales down). No vig; more like fixed brokerage.
• Transaction Fee: None beyond trading.
• Deposit/Withdrawal Fees: Platform: 0% for most (bank, card). Card deposits: Up to 3% (third-party). Withdrawals: ACH free; wires/crypto variable (0-1%).
• Payouts in cash/crypto. Fees lower for high-volume users. Blends prediction with derivatives; tech fees apply on some closes ($0.10)

4. DraftKings Prediction

• Trading/Commission Fee: charges a $0.01 transaction fee for each event contract bought or sold.

5. Fanduel Predicts

• Trading/Commission Fee: users are charged a flat 2% transaction fee based on the potential payout of their event contracts
• When you place an order (buy “Yes” or “No” contracts on an event), a fee is calculated as 2% of the maximum potential payout you could receive if your prediction is correct.
• Example: If you make a prediction where the potential payout upon settlement is $100, you will be charged a $2 transaction fee at the moment you place the order.
• Cash Out Fees: The same 2% fee structure applies if you decide to use the “cash out” feature, which allows you to sell your position before the market settles to lock in gains or limit losses.
• No Additional Fees for Correct Predictions: If you hold your contract until the event concludes and your prediction is correct, your payout is added to your account, and no further fees are charged by FanDuel for that transaction beyond the initial checkout fee. The contract simply settles at a value of $1. 
• Contract Pricing: Contracts range in price from as little as $0.01 to $0.99, with the price reflecting the market’s perceived probability of the event occurring.
• Market-Driven Prices: FanDuel does not set prices; instead, they are determined by demand from users (traders). This creates a dynamic, fluid market environment.
• Diverse Markets: Beyond sports, the platform offers predictions on financial benchmarks like the S&P 500, commodity prices (oil, gold), and even political outcomes, allowing users to engage with a wide variety of events.
• State Availability: FanDuel Predicts was strategically launched in states where online sports betting is not yet legal (initially Alabama, Alaska, North Dakota, South Carolina, and South Dakota), serving as a pathway to reach customers in those regions under federal regulation. 

Platform	Type	Trading/Commission Fee	Effective Rate (% of Premium/Position)	Transaction Fee (per Bet)	Dep/Wd Fees	Notes (Key Differentiators)
Kalshi	Prediction Exchange	Variable taker/maker (0.07/0.0175 × C × P × (1-P))	0.07-1.75% (taker); 0.02-0.44% (maker)	None	ACH: $0; Debit: 2% dep/$2 wd	Lowest for makers; scales with probability imbalance. No settlement fees.
Polymarket	Prediction Exchange	0% (crypto); 0.01% taker (US)	0% (crypto); 0.01% (US)	None	0% (intermediary gas ~$1-5)	Fee-free core; US minimal to comply. 24/7 trading.
Crypto.com	Prediction Hybrid	Flat $0.02-0.10 per open/close	~0.1-1% (volume-dependent)	None	0% most; cards up to 2.99%	Fixed low; early close allowed. Payouts in crypto/cash.