- PredictIt is a US political prediction market. It is not a registered exchange: it operates under CFTC staff no-action relief, which staff can change or withdraw.
- PredictIt fees: 10% of the profit on each winning trade, and no fee on a losing one. Since September 23, 2026, ACH deposits and withdrawals are free; the old 5% withdrawal fee is gone.
- The cap per contract equals the federal limit on a donation to one candidate per election, which was $3,500 when the CFTC wrote the letter in July 2025. The old 5,000-trader limit per contract is gone.
- It suits small positions on political questions; regulated exchanges offer more categories and no cap of this kind.
This review covers how PredictIt is regulated, what its fees cost on a winning trade, the cap on each position and how it differs from exchanges like Kalshi, as of October 2026. It works differently from the CFTC-registered exchanges. Nothing here is advice; if the format is new to you, read what prediction markets are.
Is PredictIt legal? How it is regulated
PredictIt isn't a registered exchange. It operates under a no-action letter: a statement from CFTC staff that they will not recommend enforcement as long as the market stays within set conditions. The original relief (CFTC Letter 14-130) went to Victoria University of Wellington for a small-scale, not-for-profit market for educational purposes.
In July 2025 the CFTC's Division of Market Oversight amended that relief in CFTC Letter 25-20. It let the university transfer operation of the market to the Prediction Market Research Consortium (PMRC), a US not-for-profit run by a board of academics. The letter says PMRC may contract with for-profit companies, including Aristotle International, PredictIt's market servicer, for day-to-day operation. It also says the relief is issued to PMRC and does not pass to another entity through a later sale or transfer of operations.
The letter keeps the market restricted to political events, such as elections and other significant political questions not involving war, terrorism or assassination.
Separately, Aristotle held a CFTC-registered exchange and clearinghouse. In March 2026 it sold those entities to Underdog, which now runs them as UDX. Trade press reports Aristotle continues to service PredictIt itself.
PredictIt fees
PredictIt charges its trading fee on profit: it takes 10% of the profit on each winning trade. That makes it free when you lose, and costly when you win big or trade in and out often. PredictIt's product update of September 23, 2026 removed its 5% withdrawal fee: ACH deposits and withdrawals by ACH or check are now free. Card deposits carry the 3% processing cost charged by the card network, waived on your next card deposit of up to $1,000, so ACH is the cheaper way to fund an account.
A worked example (hypothetical): you buy 100 shares at 40¢, spending $40. If the contract resolves Yes, it pays $100, a profit of $60. The 10% fee is $6, leaving $54 net. Before fees you break even if the contract wins 40% of the time; the profit fee pushes that break-even rate higher. You can compare this profit-share model with per-contract fees on regulated exchanges in our fee calculator.
The position limit
CFTC Letter 25-20 sets the investment limit for a single participant in any one contract at the federal limit on individual contributions to a candidate per election, as that limit is adjusted over time. The letter notes the figure was $3,500 at the time and is adjusted for inflation every two years, so the cap can rise. The letter also removed the old limit of 5,000 traders in any one contract, which had left popular contracts illiquid because new traders could not enter.
PredictIt at a glance
| Feature | PredictIt |
|---|---|
| Status | Research market under a CFTC no-action letter |
| Markets | Political questions; an economic-indicator carve-out remains in the relief |
| Position limit | Tied to the federal candidate contribution limit ($3,500 in the July 2025 letter) |
| Fees | 10% of profit on winning trades; free ACH deposits and withdrawals; 3% on card deposits |
Pros and cons
| Pros | Cons |
|---|---|
| Focused on US political questions | Not a registered exchange; relies on a no-action letter |
| No fee on losing trades | Profit share is expensive on big wins |
| No trader limit per contract since 2025 | Position cap per contract, and little beyond politics |
How PredictIt compares with regulated exchanges
Kalshi is a CFTC-registered exchange that charges its fee per contract rather than on profits. PredictIt's strengths are its focus on US political questions and a fee model that costs nothing on losing trades. Its weaknesses are the cap, the profit share on wins, and reliance on regulatory relief rather than registration. Our Kalshi vs Polymarket comparison, Kalshi review and platform comparison set the fee models side by side.
Where this can go wrong
No-action relief is not a law or a licence. Staff can change or withdraw it, and the 2025 letter shows terms moving. Fees, funding terms and limits also change; confirm them on PredictIt before depositing. Thin markets can be moved by one trader, and a profit fee means a price edge has to be larger than on a per-contract fee exchange to pay.
Who it suits
PredictIt suits US politics followers who want small positions on a wide range of political questions. See current political prices on our politics markets page.
Frequently asked questions
Is PredictIt legal?
PredictIt operates under CFTC staff no-action relief as a not-for-profit research market, not as a registered exchange. That relief is staff's enforcement position, not a licence, and staff can change or withdraw it. The relief depends on staying within its conditions, including the political-events scope and the investment cap.
What are PredictIt fees?
PredictIt takes 10% of the profit on each winning trade and nothing on a losing one. Since September 23, 2026, ACH deposits and withdrawals are free. Card deposits carry a 3% processing cost after a one-time waiver on the next card deposit of up to $1,000.
What is the PredictIt limit?
The cap per contract follows the federal limit on individual contributions to a candidate per election, which was $3,500 in the July 2025 CFTC letter and is adjusted over time. The 5,000-trader limit per contract was removed.
Who owns PredictIt?
Under the 2025 amendment, operation moved from Victoria University of Wellington to the Prediction Market Research Consortium, a US not-for-profit, with Aristotle International as servicer. Underdog bought Aristotle's separate registered exchange and clearinghouse in March 2026.
Is PredictIt better than Kalshi?
It depends on what you trade. PredictIt is focused on politics, capped and charges a profit share. Kalshi is a registered exchange with per-contract fees. See the comparison for details.