MiB: Luana Lopes Lara, Kalshi

April 16, 2022
8:00 am

Justice News Flash Report

MiB: Luana Lopes Lara, Kalshi

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This week, we interviewed Luana Lopes Lara, co-founder of KalshiEX LLC. Kalshi has developed an asset class – “event contracts” – and a financial exchange for trading the outcome of events. Following approval from the Commodity Futures Trading Commission (CFTC), Kalshi became the first regulated financial exchange exclusively for trading event contracts.

She discusses how the company was born from her first job on Wall Street: She worked as a quantitative trader at Citadel Securities and as a software engineer at Bridgewater Associates; her co-founder Tarek Mansour was a quantitative trader at Citadel Securities Trader and equity derivatives analyst at Goldman Sachs.

There is a particular need to directly hedge against real-world events, but there is no mechanism for doing so. Lara and Mansour delved into why this wasn’t available, called over 70 lawyers only to be told it didn’t exist because it didn’t. They come from technical rather than financial backgrounds – they’re all MIT undergraduates – and they’re trying their best to move forward anyway. Their tenacity has led to being the first and only CFTC-approved and federally regulated active contract platform.

Kalshi’s event contracts are always yes/no questions, with clear contract settlement rules (defining determinants of outcomes). They want people to be more interested in real events than in traditional financial assets, driving their business growth.

A list of his favorite books is here; a transcript of our conversation is available here on Monday.

You can stream and download our full conversations, including podcast add-ons iTunes, Spotify, stapler, Google, Bloombergand Akaster. All early podcasts on your favorite podcast host are available find here.

Be sure to check out our Master of Business Next week with Mark Jenkins, principal global creditexist Carlyle. The company manages over $300 billion in assets. Carlyle’s global credit platform manages more than $73 billion in liquid, illiquid and real asset strategies.