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r/algotrading
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Prediction Market Arbitrage Scanner API

An API service that continuously scans Kalshi and Polymarket for pricing discrepancies on identical settlement markets, enabling traders to execute risk-free arbitrage strategies. It filters for true rule matches and alerts users to opportunities.

Rising +100%1 channel30-day mention trend: latest 2, peak 3, 30-day series
View on Reddit
Discovered Oct 16, 2026

Why this matters

You are a quantitative trader looking for edge in prediction markets but struggle to find true arbitrage opportunities because filtering identical settlement rules across venues is manual and error-prone. You need a real-time scanner that surfaces genuine pricing discrepancies and alerts you before the window closes, while accounting for the execution risk of filling both legs.

  • · Built for Quantitative traders and developers building automated prediction market strategies.
  • · Most likely monetization: API subscription.

The Pain · Narrative

You are a quantitative trader looking for edge in prediction markets but struggle to find true arbitrage opportunities because filtering identical settlement rules across venues is manual and error-prone. You need a real-time scanner that surfaces genuine pricing discrepancies and alerts you before the window closes, while accounting for the execution risk of filling both legs.

Score Breakdown

Pain Intensity6/10
Willingness to Pay7/10
Ease of Build6/10
Sustainability4/10

Market Signal

30-day mention trendPeak: 3
Sparkline: latest 2, peak 3, 30-day series
Channels covered
algotrading

Go-to-Market

Exact target user

Developers and quant traders building automated prediction market bots

Estimated user count

~2,000-5,000 technically skilled traders

Primary acquisition channel

Hacker News launch and r/algotrading organic posts

Price anchor

$49/month for API access

First milestone

15 API subscribers within 30 days of launch

MVP Scope · 1–2 weeks

Week 1
  • Build market metadata scrapers for both venues to collect settlement rules
  • Develop a matching algorithm to identify truly identical markets
  • Create a real-time price comparison engine that calculates spreads after fees
  • Set up a basic REST API endpoint to query current arbitrage opportunities
  • Implement basic rate limiting and API key authentication
Week 2
  • Add WebSocket alerting for real-time arbitrage opportunity notifications
  • Build an execution risk scorer based on order book depth and liquidity
  • Create a historical database to track how long arbitrage windows typically last
  • Develop a simple dashboard for users to view and filter opportunities
  • Launch on developer communities and gather feedback from beta testers
MVP Features: Real-time arbitrage opportunity detection · Settlement-rule parsing and matching engine · REST API with WebSocket alerts · Historical arbitrage spread database · Execution risk scoring for flagged opportunities

Differentiation

Existing solutions
KalshiPolymarket
Our angle
No commercial smart order routing (SOR) engine exists specifically for prediction markets to optimize execution across fragmented liquidity pools

Why This Might Fail

Self-rebuttal — the most important trust signal

  1. 1Arbitrage windows in prediction markets may be too brief and too thin for traders to execute profitably after fees and latency.
  2. 2The user base of technically capable quant traders in prediction markets is extremely small, limiting revenue potential.
  3. 3Venues may actively oppose cross-platform arbitrage and implement throttling or bans on accounts that engage in it.

Evidence Summary

How AI synthesized this insight — no verbatim quotes

One commenter referenced a previous arbitrage scan but noted that filtering for identical settlement rules was a key fix. The discussion around execution risk and thin books suggests that arbitrage is challenging to execute manually. This indicates a niche but real need for automated scanning among technical traders.

1 1 post analyzed1 1 channelAI · AI synthesized · no verbatim

Action Plan

Validate this opportunity before writing code

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Headline

Prediction Market Arbitrage Scanner API

Sub-headline

An API service that continuously scans Kalshi and Polymarket for pricing discrepancies on identical settlement markets, enabling traders to execute risk-free arbitrage strategies. It filters for true rule matches and alerts users to opportunities.

Who It's For

For Quantitative traders and developers building automated prediction market strategies

Feature List

✓ Real-time arbitrage opportunity detection ✓ Settlement-rule parsing and matching engine ✓ REST API with WebSocket alerts ✓ Historical arbitrage spread database ✓ Execution risk scoring for flagged opportunities

Where to Validate

Share your landing page in r/r/algotrading — that's exactly where these pain points were discovered.

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Report & PRDBUSINESS

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Frequently asked questions

Who feels this pain?
Quantitative traders and developers building automated prediction market strategies
Is this a real opportunity?
This opportunity scores 58/100 on Pain Spotter's composite metric (pain intensity, willingness to pay, technical feasibility and sustainability). Validate further before committing engineering time.
How should I validate it?
Run 5 customer-discovery conversations with the target audience, post a landing page with a waitlist, and check the linked source post for recent activity before building.