House Oversight Chairman Comer has launched an investigation into insider trading on prediction market platforms Kalshi and Polymarket, sending letters to both CEOs with a deadline to respond by June.
The move follows India’s recent crackdown on Polymarket. Prediction markets, as an emerging financial instrument, operate in a regulatory gray area.
The probe will examine whether trades exploiting non-public information have occurred, whether platforms have adequate monitoring mechanisms to detect and prevent insider trading, and whether prediction markets should fall under CFTC oversight.
If systemic insider trading is confirmed, it could push the US toward stricter regulation of prediction markets, affecting compliance costs and growth prospects for this nascent industry.