Kalshi Proposes Trading on Flight Cancellations

Prediction market platform Kalshi has filed a self-certification with the Commodity Futures Trading Commission (CFTC) to introduce a new market focused on airline flight cancellations. The proposed "Sky Trading" market would permit users to trade contracts based on whether a specific percentage of flights at a given airport are canceled during a defined period.

The trading contracts would be structured around thresholds, such as "above," "below," or "at least" a certain cancellation percentage. Kalshi intends to use data from FlightAware, a flight tracking service, as the primary data source, with potential backup from the U.S. Department of Transportation's Bureau of Transportation Statistics.

The market would account for preemptive cancellations, such as those made in anticipation of a storm. However, flight delays and diversions would not count towards the cancellation percentage used for trading.

A spokesperson for Kalshi confirmed the CFTC filing to Inc. magazine, stating the market is not yet live and that the company is evaluating its utility for hedging travel-related risks. Kalshi, founded in 2018, was the first federally regulated prediction market authorized by the CFTC in 2020.