Kalshi + Polymarket Arbitrage Trading Bot

A production-ready TypeScript toolkit for Bitcoin 15-minute up/down prediction markets on Kalshi and Polymarket. Combines dual-venue monitoring, automated arbitrage detection, and cross-platform order execution.

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Table of Contents

• Overview
• The Arbitrage Opportunity
• Research & Strategy
• Features
• Architecture
• Quick Start
• Configuration
• Usage Examples
• Environment Reference
• Programmatic API
• Developer
• Stack & Documentation

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Overview

Both Kalshi and Polymarket offer Bitcoin 15-minute up/down markets: will BTC price be up or down at the end of a 15-minute window? Because these markets trade on separate order books, prices can diverge. When the sum of opposite sides (e.g., Kalshi UP + Polymarket DOWN) falls below a threshold, a risk-free or near–risk-free arbitrage exists.

This bot:

• Monitors best-ask prices on both venues in real time
• Detects when an arbitrage opportunity is in range [ARB_SUM_LOW, ARB_SUM_THRESHOLD)
• Places simultaneous limit orders on both platforms (configurable, with dry-run support)

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The Arbitrage Opportunity

Same Market, Two Platforms

Both platforms trade the same underlying event (Bitcoin price at a fixed 15-minute close), but each has its own order book. Price differences create opportunities:

Example: Buy UP on Kalshi (60¢) and DOWN on Polymarket (27¢). If UP + DOWN < 1, you lock in a guaranteed payoff.

When Opportunities Appear

Small difference in "Price to beat" — markets are closely aligned; arbitrage is rare:

Polymarket: $70,462.56 vs Kalshi: $70,459.83 — nearly identical strike prices.

Large difference in "Price to beat" — more divergence, more potential arb:

Polymarket: $71,434.63 vs Kalshi: $71,416.72 — larger spread increases arb probability.

How the Bot Quantifies It

Leg	Kalshi	Polymarket	Sum	Action
Leg 1	Buy YES (UP)	Buy DOWN	kUp + polyDown	Opportunity when sum ∈ [0.75, 0.92)
Leg 2	Buy NO (DOWN)	Buy UP	kDown + polyUp	Same trigger range

When sum < 1, one side pays out $1 and the other expires worthless; total cost < $1 ⇒ profit.

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Research & Strategy

The bot’s logic is driven by real-time order book data rather than research models. For event-based research and edge detection, the following example shows the kind of analysis that informs strategy design:

Example of analytical output: Event, market, action, research vs market probability, confidence, and reasoning. The arb bot focuses on BTC 15m structural mispricing instead of event-level research.

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Features

Feature	Description
Balance	Fetch Kalshi portfolio balance via REST
Kalshi single order	Place one limit order on the first open KXBTC15M market
Dual-venue monitor	Poll best-ask prices from Kalshi + Polymarket; log to 15m-slot files; optional restart at :00/:15/:30/:45
Cross-venue arb	When sum ∈ [ARB_SUM_LOW, ARB_SUM_THRESHOLD), place one order per venue (at most one per leg per market)
Polymarket single order	Place one limit buy for the DOWN token on the current BTC 15m market

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Architecture

┌─────────────────────────────────────────────────────────────────┐
│                     npm start (Monitor + Arb)                     │
├─────────────────────────────────────────────────────────────────┤
│  Dual Price Monitor (KALSHI_MONITOR_INTERVAL_MS)                  │
│  ├── Kalshi REST API (kalshi-typescript) → getMarket / orderbook   │
│  └── Polymarket CLOB + Gamma → getOrderBook / slug resolution      │
│       ↓                                                           │
│  checkArbAndPlaceOrders(DualMarketPrices)                          │
│  ├── sumUp = kUp + polyDown  →  Leg 1: Kalshi YES + Poly DOWN     │
│  └── sumDown = kDown + polyUp → Leg 2: Kalshi NO  + Poly UP       │
│       ↓                                                           │
│  placeOrder (Kalshi) + placePolymarketOrder (Polymarket)           │
└─────────────────────────────────────────────────────────────────┘

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Quick Start

1. Clone and Install

git clone https://github.com/recodehive/Polymarket-Kalshi-Arbitrage-Trading-Bot.git
cd Polymarket-Kalshi-Arbitrage-Trading-Bot
npm install

2. Configure Environment

cp .env.sample .env

Edit .env with:

• Kalshi: KALSHI_API_KEY, KALSHI_PRIVATE_KEY_PEM
• Polymarket : POLYMARKET_PRIVATE_KEY, POLYMARKET_PROXY for arb on both legs

3. Run Commands

# Check Kalshi balance
npm run balance

# Place one Kalshi order (dry run first)
KALSHI_BOT_DRY_RUN=true npm run kalshi-single-order

# Start dual monitor + arb
npm start

# Run with mock data (when env/keys are invalid; shows banner, no real orders)
MOCK_MODE=true npm start

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Configuration

Kalshi Authentication

Kalshi uses RSA-PSS signing. Provide either (PEM in .env is preferred; avoids path issues):

• KALSHI_PRIVATE_KEY_PEM — recommended — full PEM string directly in .env (use \n for newlines)
• KALSHI_PRIVATE_KEY_PATH — fallback — path to your .pem file

Key must be RSA PKCS#1 (-----BEGIN RSA PRIVATE KEY-----). If you have PKCS#8, convert with:

openssl rsa -in key.pem -out rsa_key.pem

Polymarket (Optional)

• POLYMARKET_PRIVATE_KEY — wallet private key (hex, with or without 0x)
• POLYMARKET_PROXY — Polymarket proxy/funder address

If Polymarket credentials are not set, the arb bot will only place Kalshi orders.

Dry Run Mode

Always test without real money:

KALSHI_BOT_DRY_RUN=true npm run kalshi-single-order
ARB_DRY_RUN=true npm start

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Usage Examples

Kalshi Single Order

# Dry run
KALSHI_BOT_DRY_RUN=true npm run kalshi-single-order

# Live: Buy YES (UP) @ 50¢, 2 contracts
KALSHI_BOT_SIDE=yes KALSHI_BOT_PRICE_CENTS=50 KALSHI_BOT_CONTRACTS=2 npm run kalshi-single-order

# Buy NO (DOWN) @ 45¢
KALSHI_BOT_SIDE=no KALSHI_BOT_PRICE_CENTS=45 KALSHI_BOT_CONTRACTS=1 npm run kalshi-single-order

Polymarket Single Order

# Place one limit buy: DOWN token @ 0.45, size 10
npm run poly-single-order 0.45 10

# Default (uses config defaults)
npm run poly-single-order

Monitor & Arb

# Start dual monitor + arb (single-instance lock)
npm start

# Run with mock data (when env/keys are invalid; no real API calls or orders)
MOCK_MODE=true npm start

• Logs: logs/monitor_YYYY-MM-DD_HH-{00|15|30|45}.log
• Lock file: logs/monitor.lock (prevents duplicate processes)
• Without KALSHI_MONITOR_TICKER, the process can restart at quarter-hour boundaries to pick up new markets

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Environment Reference

Variable	Description	Default
Kalshi
KALSHI_API_KEY	API key ID	required
KALSHI_PRIVATE_KEY_PEM	PEM string in .env (recommended; no path issues)	—
KALSHI_PRIVATE_KEY_PATH	Path to RSA private key .pem (fallback)	—
KALSHI_DEMO	Use demo env (demo-api.kalshi.co)	false
KALSHI_BASE_PATH	Override API base URL	prod or demo
Bot
KALSHI_BOT_SIDE	yes or no	yes
KALSHI_BOT_PRICE_CENTS	Limit price 1–99	50
KALSHI_BOT_CONTRACTS	Contracts per order	1
KALSHI_BOT_MAX_MARKETS	Max markets to consider	1
KALSHI_BOT_DRY_RUN	No real Kalshi orders	false
Mock mode
MOCK_MODE	Run with simulated data (no real API/orders); shows banner	false
Monitor
KALSHI_MONITOR_INTERVAL_MS	Poll interval (ms)	2000
KALSHI_MONITOR_TICKER	Fixed ticker (skip auto-refresh)	—
KALSHI_MONITOR_NO_RESTART	Disable 15m restart	—
Arb
ARB_SUM_THRESHOLD	Upper bound for opportunity	0.92
ARB_SUM_LOW	Lower bound (ignore if below)	0.75
ARB_PRICE_BUFFER	Add to captured ask for limit	0.01
ARB_SIZE	Size on both platforms	1
ARB_DRY_RUN	Log only, no orders	false
Polymarket
POLYMARKET_PRIVATE_KEY	Wallet private key	—
POLYMARKET_PROXY	Proxy/funder address	—
POLYMARKET_CLOB_URL	CLOB API URL	https://clob.polymarket.com
POLYMARKET_CHAIN_ID	Chain ID (137 = Polygon)	137

See .env.sample for the full list.

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Programmatic API

Kalshi

import { placeOrder } from "./bot";

const result = await placeOrder("KXBTC15M-24MAR10-2330", "yes", 2, 50);
// { orderId: "..." } or { error: "..." }

Polymarket

import { placePolymarketOrder } from "./polymarket-order";
import { getTokenIdsForSlugCached } from "./polymarket-monitor";

const { upTokenId, downTokenId } = await getTokenIdsForSlugCached("btc-updown-15m-20240310-2300");
const result = await placePolymarketOrder(downTokenId, 0.45, 10);

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Developer

Alexei — Expert in trading bot development (EVM, Solana, Polymarket, Kalshi, prediction markets).

Questions? Telegram

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Stack & Documentation

Resource	URL
Packages	kalshi-typescript, @polymarket/clob-client, ethers
Kalshi API	docs.kalshi.com
TypeScript SDK	Quick Start
WebSockets	WebSocket Connection

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Tech: Node.js, TypeScript, Kalshi REST API, Polymarket CLOB, Gamma API for market resolution.