Tangent
The CFTC has already shared some guidelines with online betting platforms, according to the Journal. On Tuesday, Kalshi announced three new so-called “market integrity” measures for its platform to crack down on insider bets—including risk scoring, employment verification for some bettors and expanded whistleblower tools. The platform said it will provide a “risk score” for bets that have “heightened insider trading or manipulation risk.” The risk measurement will involve various metrics, including whether there are any national security concerns or potential regulatory issues. The risk scoring will also measure instances in which actions by a single person or a small “opaque group” could significantly affect the market. If a bet meets a certain risk-scoring threshold, participants will need to share employment verification details, allowing Kalshi to screen bettors for potential insider activity. The platform will also allow its bettors to report potential abusive behavior or market manipulation, which will then be examined by a 24/7 surveillance team, Kalshi said.
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What Do We Know About Recent Insider Betting Cases?
In April, a U.S. Special Forces soldier involved in a raid to capture Venezuelan President Nicolas Maduro was charged with using classified information to win more than $400,000 on Polymarket. The DOJ said the soldier was charged with unlawful use of confidential government information for personal gain. The soldier made 13 bets on Maduro- and Venezuela-related markets in late December last year, just days before the raid, and as a result, he profited approximately $409,881 after the Venezuelan leader’s capture. In a separate incident in late April, Kalshi announced it had suspended the accounts of three political candidates who placed bets on the outcome of their own election races. Late last month, federal prosecutors charged a Google employee after he allegedly earned $1.2 million from bets on Polymarket using insider information. The prosecutors alleged that the Google staffer used insider information about Google’s Year in Search data to make the winning bets—specifically that singer D4vd would be named the top-most searched person of 2025.
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further reading
Trump Regulator Proposes New Rules on What’s Allowed on Prediction Markets (Wall Street Journal)
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