Asset managers aren't restricted to trading things on exchanges unless their docs explicitly say so. Many hedge funds place bets directly with investment banks, through exchanges in the US, overseas exchanges etc.

Hedge Funds were more or less created for the express purpose of getting around restrictions that traditional asset management structures place on fund usage. But yes, Hedge Funds, Private Equity, Venture Capital and Family Offices can basically do whatever they want within the confines of their investor agreements.

"traditional" = funds holding publicly listed stocks and bonds? Basically, mutual funds? If that's it, there isn't a "traditional" asset manager that is going to Kalshi to put bets on events.

Note in the post - the buyers who head to goldman to get exposure through a basket of positions are not "traditional" asset managers.

Put another way - the relevant asset managers were not restricted.