Polymarket Kalshi Arbitrage

A Systematic Strategy for Polymarket × Kalshi Inefficiencies Abstract Prediction markets have matured into highly reactive, information-driven trading environments. However, structural fragmentation between platforms creates persistent inefficiencies. This article presents a systematic arbitrage strategy exploiting pricing discrepancies between two major prediction exchanges—Polymarket and Kalshi—within short-duration (15-minute) markets. We formalize the arbitrage condition, analyze execution risks, and outline a production-grade architecture for building a scalable trading system. 1. Introduction Prediction markets are designed to converge toward probabilistic truth. Yet in practice, latency, liquidity fragmentation, and differing participant bases lead to temporary mispricings across platforms. In short-horizon markets (e.g., 15-minute BTC direction), these inefficiencies appear frequently and predictably. This creates an opportunity: Simultaneously take opposite positions across tw