Business
Exclusive: Kalshi partners with Blanket to help small businesses hedge against risk—with help from the guru of ‘hypergamblification’
An independent financial economist has partnered with Kalshi on a new AI tool on top of the prediction-market exchange that aims to help small businesses hedge against everything from bad weather to election shocks—without hiring a Wall Street bank.
The tool, called Blanket, quietly launched in stealth at tryblanket.app and is going live publicly this week, according to materials shared exclusively with Fortune and an interview with its cocreator, Lauris Zminsky, a London-based founder who calls himself a “forward deployed philosopher” on his X account, where he says he wants “markets for all priceable states of the world.”
Blanket is “powered by Kalshi,” meaning it routes users to Kalshi’s Commodity Futures Trading Commission or CFTC–regulated prediction markets, but it was built and is owned by Zminsky, who does not work for the company.
Zminsky, a former consumer fintech founder and trained financial economist, said he began experimenting with Kalshi’s event contracts late last year as a way to prove that prediction markets could have “true, durable economic use” beyond pure speculation. His first project, built with a Kalshi employee, aspires to match S&P 500 companies’ risk factors with existing Kalshi markets. Blanket, he says, is the self-serve evolution of that idea for Main Street rather than the S&P. Zminsky told Fortune he has been working often with Kalshi because of overlapping social circles—“a bunch of my friends … actually work at Kalshi and do a lot of great stuff with Kalshi”—and was coy about whether he may go in-house some day.
After Kalshi launched a promotion with sports bars in May, Zminsky told Fortune, he had an idea: “What if you actually can take this up a notch and build a tool that is not only probably useful for the Kalshi team and their endeavors—to scale their S&P insurance hedging initiative—but a self-service tool where anybody can come in if they own a small business?” Off a prompt, he added, a reasoning engine could be designed to help these small businesses figure out what kind of Kalshi markets could help them run a promotion or hedge against a core business risk.
This may not be transformative for how small businesses run, Zminsky cautioned, “but you can definitely de-risk a lot of your balance sheet exposures” by finding the right markets and sizing the bets correctly. Blanket’s pitch is simple: A bar owner, laundromat operator, or regional restaurant plugs in a concrete worry—hurricane season in Florida, a spike in fuel prices, an unusually warm winter—and the AI “reasoning engine” will suggest specific yes-or-no markets on Kalshi that could offset that risk if the bad outcome hits.
Crucially, Blanket is not a trading app.
“You can’t execute a trade. There’s no money moving through that application or system at all,” Zminsky said. “It’s a reasoning tool. It’s a discovery tool that funnels you towards Kalshi.” Once a user clicks through, execution, compliance, and customer vetting all happen on Kalshi’s side, which operates as a federally regulated event-contract exchange. A Kalshi spokesperson told Fortune that Blanket is a fully external project that simply references public Kalshi contracts and that Kalshi’s compliance team was not involved in its creation.
Then Zminsky and I talked about his X essay from 2025 on his theory of “hypergamblification.”
Did prediction markets create something new, or tap into a deep human desire?
Kalshi, founded in 2018, has leaned heavily into hedging as its answer to critics who say prediction markets are just legalized gambling. On its own marketing site, the company showcases bars, restaurants, and consumer brands that hedge, say weather for ice-cream shops and refunds tied to Knicks games—Utopia Bagels was surely off the hook for free bagels after the Trump-attended loss in game 3 of the NBA Finals.
Nicolas Hull, who runs point on small-business hedging at Kalshi, has already been quietly working with firms using those kinds of strategies; Blanket is designed to give them, and thousands of similar businesses, an on-ramp without a sales call. “SMBs [small and medium-size businesses] are turning to Kalshi to hedge against the real world,” Hull told Fortune. “Whether it’s the financial fallout from weather anomalies, major sports tournaments, or freight and tariff volatility, business owners are using our platform to protect their bottom lines.” He called it a “massive growth segment” for Kalshi, saying he expected it to only expand as more companies discover this “innovative way to offset costs and manage uncertainty.”
Zminsky argued the technology is less exotic than it sounds—similar in spirit to the opaque derivatives that helped blow up Wall Street in 2008 but fundamentally safer. Calling in from London’s leafy Kensington neighborhood, he agreed Kalshi resembles other innovations throughout history, like the nearby Lloyd’s of London, founded in the late 1600s as a hedging operation of sorts out of a coffee shop, before turning into an insurance giant.
What’s new is casting those protections as event contracts anyone can see and price. “What prediction markets unlock is having the ability to take credit-derivative-like exposures and make the reference asset be an event,” Zminsky said.
In fact, a Kalshi spokesperson likened the way Blanket works to the insurance sector, explaining that Blanket recommendations are tailored to insurance use cases. Large “losses” in such a scenario mean the event you did not want to happen did not happen, while large “wins” mean that it did. “It’s about making sure people lower their overall risk, not about promoting big wins or big losses.”
To Zminsky, it’s another way that the tools that used to be accessible only to Wall Street’s Masters of the Universe are available for all of us now: “You take instruments that were previously only bilaterally traded by extremely large financial institutions, and you make them accessible for a broader [audience].”
What is to prevent a 2008-style blowup with all this democratized finance? “Regulation,” Zminsky said proudly. Kalshi’s contracts are standardized, electronically traded, and overseen by the Commodity Futures Trading Commission. “You can see what everything is on Kalshi,” he said. “Anybody can open up the actual contract [and] read the rules.”
The hypergamblification tension
But Zminsky’s own writing points to an unresolved tension at the heart of tools like Blanket: Are they sober risk-management infrastructure, or part of a broader shift to turning speculation into entertainment?
In an August 2025 article on X titled “Play As Mechanism: An Intro to Hypergamblified Market Design,” Zminsky argued “at its core, play has always been about risk, speculation, and dopamine,” from Roman dice games and casinos to sports betting and ripping Pokémon packs.
“This isn’t a bug,” he writes. “Speculation is the feature. It’s what makes games sticky, viral, and communal. When risk is in the loop, attention compounds.” He called the convergence of those dynamics hypergamblification—“the merging of speculative play-like mechanics and financial speculation into one viral entertainment substrate.”
Prediction markets, in that framework, are not just hedging tools but games: “If you strip away the branding, prediction markets are a game. The market is the entertainment loop; the payoff is truth at settlement,” he wrote.
The appeal is small pools let retail “move the line,” and “consequence is the content,” he argued, conjuring up a whole new world of democratized, gamified finance in which speculation drives ever upward. “Odds are memes,” and bets naturally drive conversation that in turn drives more bets. “They’re durable because they fuse speculation with consequence and distribution.”
That sits uneasily alongside Blanket’s hedging pitch.
“That’s really old,” Zminsky said of his paper from last August. “I have better ones,” he added, before saying that it has “absolutely” zero connection to his work on Blanket. “I deliberately moved away from that.”
On the phone, Zminsky was careful to insist the app is “just a discovery tool” for small-business balance sheets, and no money moves through it. Yet his hypergamblification thesis assumes any system wired into markets will eventually behave like an arcade plugged into a financial system—“every cabinet a micro-market, every action priced, every new player adding liquidity to the loop.”
The hypergamblification essay, Zminsky explained, was “more related to the fact that, you know, I think a lot of young adults don’t necessarily see a pathway towards homeownership or having a reasonably paying job that provides them with sufficient amounts of financial security … They’re leading towards more of a lottery ticket approach towards life, which I do think is very disruptive and healthy.”
When asked if this fell into what’s called “financial nihilism,” he agreed, before saying that’s more of a “structural, sociopolitical issue” that is beyond his scope to comment on.
“Our dopamine receptors are being captured every single day,” Zminsky added. “And that just primes us to really find the most rewarding or short-term solutions for any of the needs or problems … that we’re effectively facing in our individual lives.”
His old essay was about his sense that “a lot of young people are embracing lottery-ticket economics because, you know, they don’t really see another way out.” But his Blanket work is separate from that, he added.
For Kalshi, which has weathered regulatory fights and ongoing scrutiny from gambling opponents, that ambiguity cuts both ways. On one reading, Blanket is exactly what the company’s critics say they want: a regulated, transparent way for everyday businesses to hedge concrete risks that insurance either doesn’t cover or prices out of reach. On another, it’s a fresh interface pulling more people into an underlying architecture whose creator openly celebrates “risk, speculation, and dopamine” as the core mechanism of play—and sees prediction markets as the purest expression of that idea.
When asked about this critique, Kalshi told Fortune that it sees itself as “the safest venue for people to trade on,” with every single customer protection feature that state-regulated sportsbooks have (e.g, trading breaks, self-exclusion, and deposit limits). It also cited mental-health features through partnerships with firms like Birches Health for any traders who feel uncomfortable with their use of the platform.
Compared with those of casinos, Kalshi said its customer-protection measures are superior because they are enforced nationwide, rather than varying over state lines, and that Kalshi is fundamentally not comparable to a casino because it is not the party that financially benefits from maximizing customer losses. “We are incentivized to take these potential issues seriously in a way that casinos are not,” the Kalshi spokesperson said. And compared with other commodities exchanges, Kalshi said its mental health measures are superior simply by existing: It is the only commodities exchange to offer any such services, despite the fact that all others offer financial products that can involve speculation.
Blanket itself tries to stand on the safer side of that line. Zminsky says a typical query takes “maybe 30 seconds” for the AI to process and return a short list of candidate markets, with plain-English explanations of how each one maps onto a given business risk. It will also tell a user when no suitable market exists and display “near misses,” creating a kind of live wish list of missing contracts that Kalshi’s team can monitor as demand signals. “You get inbound requests, you get market intelligence, and hopefully quite a lot of people potentially using Kalshi to hedge against the core business risks,” he said.
Are prediction markets creating a new field of speculation for the human instinct toward hypergamblification in the 21st century, or are they just unlocking a market for hedging and exchanging information that has always existed, but never had the technology to truly express itself? Zminsky said he is continuing to research this question, and may become a founder again in the future.
But he knows one thing: He’s glad he is in London and not New York anymore, where he lived for three years before a recent relocation: “I need a little bit more grounding energy. New York can be extremely distracting.”