How to Market Make on Kalshi and Polymarket in 2026
Takers pay the spread and the fee. Makers earn the spread and pay little or nothing. Here's how market making on Kalshi and Polymarket works, from fees and post-only orders to where makers lose money, and how Claw Arbs' new Maker agent can quote sports markets for you.
TL;DR
Market making on Kalshi or Polymarket means posting a limit order that rests in the order book instead of taking someone else's price. Makers pay less: Polymarket never charges makers a fee and returns 15% of sports taker fees to filled makers as a daily rebate, while Kalshi charges makers only on series that carry a maker fee, at a quarter of the taker rate. The catch is adverse selection: fills tend to arrive just before the price moves against you. A January 2026 study found Kalshi makers averaged −9.64% per contract (takers −31.46%), before Kalshi charged makers at all. Quoting pays only when your fair price is better than the book's, usually sharp bookmaker prices with the margin removed, and when you pull quotes before kickoff, when your references go stale and after a fill. Claw Arbs' Maker automates that for pre-match sports moneylines, with paper mode first and markouts that show whether your quotes really pay.
Fees, rebates and order rules checked on the venues' own pages on October 19, 2026. They change often, so confirm them before you quote.
Every trade on a prediction market has two sides. One trader posted a price and waited. The other came along and accepted it. The first is the maker, the second is the taker, and on Kalshi and Polymarket the difference decides who pays the fee and who earns the spread.
This guide explains how market making on Kalshi and Polymarket works in 2026: what makers pay, what they get back, why so many of them still lose, and how to quote sports markets from a fair price that's sharper than the book. If you're new to these venues, our comparison of the best prediction markets for arbitrage covers who can trade where.
How Market Making Works on a Prediction Market
A prediction market contract pays $1 if the outcome happens and $0 if it doesn't, so its price reads as a probability. Buyers post bids, sellers post asks, and the gap between the best bid and the best ask is the spread.
A market maker posts a limit order that rests in the book, say a bid of 46 cents for a team to win, and waits. When a seller wants out now, they hit that bid: the maker buys at 46 cents and the seller pays the spread. Nobody has to register as a maker. Whoever's resting order gets filled is the maker on that trade.
Makers earn in two ways: they buy below what the contract is really worth, and on some venues they get part of the taker's fee back. What they give up is control over timing. A taker chooses when to trade. A maker gets filled when someone else decides to trade, and that someone often knows something the maker doesn't.
Maker vs Taker Fees on Kalshi and Polymarket
Both venues charge fees that follow a curve, highest at 50 cents and shrinking toward 0 and $1. The difference is who pays.
Polymarket: Makers Pay Nothing, and Get a Rebate
Polymarket's documentation is blunt: makers are never charged fees, and only takers pay. The taker fee in sports is:
Polymarket sports taker fee = shares × 0.05 × p × (1 − p). At 50 cents that's 1.25 cents per share.
Those fees fund the Polymarket maker rebate. In sports, 15% of taker fees go back to the makers whose orders were filled, weighted along the same fee curve, calculated per market and paid daily in pUSD once your rebate reaches $1. Polymarket also runs liquidity reward programs on some markets. Treat any reward as a bonus rather than the business case, because programs like these get cut.
Kalshi: Maker Fees Only on Some Series
Kalshi's taker fee is roundup(0.07 × contracts × price × (1 − price)), which is 1.75 cents per contract at 50 cents. Kalshi maker fees apply only on series that carry one, at a quarter of the taker rate:
Kalshi maker fee (where it applies) = 0.0175 × contracts × price × (1 − price), about 0.44 cents per contract at 50 cents.
Sports makers should assume they'll pay it. Kalshi's own API lists maker fees on its NBA, NFL, Premier League, La Liga, Serie A, Bundesliga, Champions League, ATP and WTA game series, with MLB at half rate. Read the series before you quote, because the fee comes straight off your edge.
| Venue (sports) | Taker fee at 50¢ | Maker fee at 50¢ | Maker rebate |
|---|---|---|---|
| Polymarket | 1.25¢ per share | 0 | 15% of taker fees, daily |
| Kalshi | 1.75¢ per contract | About 0.44¢ on maker-fee series | None for retail makers |
Post-Only Orders: Never Take by Accident
A quote that crosses the spread stops being a quote. It takes, and it pays the taker fee. A post-only order prevents that: on Polymarket, if a post-only order would match immediately against the book, it's rejected instead of taking. Kalshi's API supports post-only orders too. Every maker quote should be post-only.
Do You Need a Market Maker Program?
No. The Kalshi market maker program is for designated firms: Kalshi reviews their financial resources, trading experience and business reputation, and in exchange for consistent two-sided quoting they may get reduced fees and adjusted position limits. Polymarket US runs an application-based program too. Everyone else is a maker the moment a resting order fills, on the standard fee schedule.
Where Makers Make Money, and Where They Lose It
Posting a bid below the last trade doesn't make you money by itself. The evidence is sobering. A January 2026 study of Kalshi by Constantin Bürgi, Wanying Deng and Karl Whelan, covering the exchange's start through April 2025, found that makers averaged a −9.64% return per contract, against −31.46% for takers. Makers did far better than takers, but still lost on average, and that was before Kalshi started charging makers fees. Makers who bought contracts costing 50 cents or more earned 2.6%.
The reason is adverse selection. Your bid fills fastest exactly when the seller knows the price is about to fall: a lineup leak, an injury, a sharp bookmaker that has already moved. The fills you get are disproportionately the ones you didn't want.
In-play is where this hurts most. During the Knicks' comeback in Game 4 of the 2026 NBA Finals, market makers on that one game lost $22.4 million before fees, according to InGame, and the largest maker's losses came mostly on in-game bets while the Knicks were far behind.
So a maker who wins usually has two things: a fair price that's better than the book's, and the discipline to stop quoting when information is about to arrive.
Market Making Strategy: Price Your Quotes From Sharp Odds
For sports, the best fair price usually comes from sharp bookmakers, whose lines move first. Take their prices, remove the bookmaker margin (the Shin method handles favorites and longshots better than a simple proportional split), and combine several books with a median so one stale book can't move your price. Our guide to devigging for prediction markets walks through the methods, and the no-vig calculator does it for a single line.
Then quote below that fair price by your minimum edge, net of the maker fee, and never above the best bid by more than one tick:
Your bid = the lower of (best bid + 1 tick) and (fair ÷ (1 + edge) − maker fee), rounded down to the tick.
Illustrative example (hypothetical prices). Sharp books put a team's fair price at 50 cents. With a 2% minimum edge, your ceiling on Kalshi is 50 ÷ 1.02 − 0.44 (the maker fee), about 48.6 cents. The best bid is 47 cents, so you bid 48: one tick better than everyone else, still under your ceiling. If it fills, you've bought a 50-cent contract for 48 cents, about +1.6 cents after the fee, before anything moves.
If another buyer were already bidding 49 cents, above your ceiling, the right quote is no quote. You don't chase.
Sports Market Making: When to Pull Your Quotes
In sports market making, a resting quote is a promise to trade at a price that may be stale a second later. The rules that keep makers alive are about when not to be in the book:
- Before kickoff. Polymarket cancels resting sports orders at the official start, but its docs warn that a game starting earlier than scheduled may not be cleared in time. Not every venue clears orders at kickoff, so pull your own.
- After a fill. A fill is information. Pause that outcome before quoting it again.
- When your references go stale, suspend or disagree. If the sharp books stop updating, suspend the market or no longer agree on a price, you no longer know the fair price.
- Around team news. Lineups and injury reports move prices in seconds, and the traders who hear first will happily sell to you.
Markouts: How to Know Whether Your Quotes Pay
Profit and loss tells you too late and too noisily whether quoting works. Markouts tell you sooner. After every fill, compare the fair price a few moments later with the price you paid: at 5 seconds, 30 seconds, 5 minutes and at the start of the match. If the fair price keeps moving in your favor after you're filled, your quotes have an edge. If it keeps moving against you, you're the one being picked off, and the fix is a better fair price or more pulls, not more volume.
Automating It: A Market Making Bot for Kalshi and Polymarket
Claw Arbs now includes Maker, a market making bot for Kalshi, Polymarket and Polymarket US. Each Maker agent quotes pre-match moneylines (soccer team win and draw contracts, tennis and basketball) and is built around the rules above:
- A sharp fair price. Sharp bookmaker prices with the margin removed (the Shin method by default), the median of several books, and no quote unless enough of them agree (two by default) within a spread you set.
- Post-only quotes at your edge. Buy quotes below that fair price by your minimum edge, after the maker fee. In live mode, when someone sells into a quote, it becomes a real bet in your Portfolio, settled with the match.
- Best price only. On by default: a quote goes up only when it can be the best bid, joining or improving the top of the book, never stuck behind other buyers.
- Automatic pulls. Quotes come down before kickoff (10 minutes before the start by default), after a fill, when a sharp reference goes stale or suspends its market, when the references disagree, and on the kill switch or a daily loss stop. A cancel only counts once the exchange confirms it.
- Optional take profit. After each fill, Maker can rest a sell offer at your profit target, after fees on both sides. It can stay up into the match until it sells or the market settles, and a sale is final.
- Paper mode first. Quotes are simulated against the real order book before any money moves (more on prediction market paper trading). Polymarket US publishes no public trades, so paper quotes there never fill. Live quoting then runs under caps: per quote, per agent, total resting money, fills per match and a daily loss stop.
- Markouts built in. Every fill is measured at 5 seconds, 30 seconds, 5 minutes and at the start, so you can see whether quoting really pays before you scale it.
Maker prices only from individual sharp books and exchanges, never from a blended line. You can also set up a Maker agent in plain English from Claude, Cursor or Codex with the Claw Arbs MCP Server. Prediction markets are also venues where winning traders don't get limited, which matters if your quotes do pay. New members can start with a 7-day free trial.
Risk note. Market making can lose money. Fills often come right before the price moves against you, every fill is a real bet that settles with the match, and nothing guarantees a return. Start in paper mode, keep your caps small, and only stake money you can afford to lose.
FAQ
How does market making work on Kalshi?
You post a limit order that rests in the order book instead of taking an existing price. When another trader sells into your bid, you are the maker on that trade and they are the taker. Makers earn the spread and pay a lower fee: on Kalshi, makers pay a fee only on series that carry one, at a quarter of the taker rate, and that includes the major sports game markets.
Does Polymarket charge maker fees?
No. Polymarket's documentation says makers are never charged fees; only takers pay. In sports, takers pay 0.05 times shares times p times (1 minus p), and Polymarket returns 15% of those taker fees to the makers whose orders were filled, as a daily rebate paid once it reaches $1.
Do you need to join a market maker program to make markets on Kalshi or Polymarket?
No. Anyone whose resting limit order gets filled is the maker on that trade. Formal market maker programs are for designated firms that accept quoting obligations in exchange for benefits such as reduced fees and adjusted position limits. A retail maker simply posts limit orders and pays the standard maker fees.
Is market making on prediction markets profitable?
Not automatically. A January 2026 study of Kalshi found makers averaged a return of minus 9.64% per contract, against minus 31.46% for takers, in a period before Kalshi charged maker fees. Fills tend to arrive just before the price moves against the maker. Quoting only pays when your fair price is better than the book's, and you pull quotes before kickoff, when your references go stale and after news.
What is a post-only order?
A post-only order only adds liquidity. If it would match immediately against the book, the exchange rejects it instead of letting it take, so you never pay the taker fee by accident. Market makers use post-only orders for every resting quote.
Is there a market making bot for Kalshi and Polymarket?
Yes. Maker in Claw Arbs is a market making bot for Kalshi, Polymarket and Polymarket US. It prices pre-match sports markets from sharp bookmaker odds, posts post-only quotes below that fair price by your minimum edge, and pulls them before kickoff, after a fill and when its references go stale. Every Maker agent starts in paper mode, and live quoting runs under caps and a daily loss stop.
Bottom Line
Market making on Kalshi and Polymarket flips the usual economics: instead of paying the spread and the fee, you earn the spread and pay little or nothing, with a daily rebate on Polymarket sports. But the venues hand makers the hardest fills, and the research shows makers lose on average without an edge. The makers who last price from sharp odds, quote post-only at the top of the book, pull before kickoff and whenever their references wobble, and judge themselves by markouts rather than a good week. Start on paper, and scale only what the numbers support.
Sources
- Polymarket documentation: fees, maker rebates, post-only orders and sports markets
- Kalshi: fee schedule and market maker program
- Bürgi, Deng and Whelan, Makers and Takers: The Economics of the Kalshi Prediction Market (January 2026)
- InGame, market maker losses on Knicks Game 4 (June 2026)