House Republicans Open Investigation Into Kalshi, Polymarket Over Insider Trading
House Oversight Committee Chair James Comer (R-KY) has initiated an investigation into prediction markets Kalshi and Polymarket, focusing on insider trading and the use of non-public information by users. Comer sent requests to both companies’ CEOs for documents covering know-your-customer (KYC) protocols, suspicious trade detection, internal discussions on reputation impact, and deliberations over wagers related to armed conflicts, including bets on the Iran war and U.S. actions in Venezuela. The probe follows incidents involving a U.S. soldier arrested for using classified information to place bets on Polymarket and Kalshi's fines against politicians betting on their own elections. Comer referenced a recent New York Times report suggesting over 80 cases of potential insider trading on Polymarket. Both firms are under increased scrutiny as prediction markets gain popularity, prompting a Senate ban on its members trading on such platforms. Kalshi and Polymarket claim they are actively combating insider trading. The House-led investigation, supported by Republican leadership, carries the power to issue subpoenas.
