Prediction Markets Tighten Rules Amid Campaign-Staff Trading Concerns

Kalshi, the largest U.S. prediction-market platform, launched a compliance program in May that cross-references the names of campaign staffers listed in Federal Election Commission (FEC) filings with its user logs. The company says the system has blocked “dozens” of trades by individuals whose names appear in the filings, though at least one staffer who was listed in FEC records succeeded in placing a bet on a race they were involved in. Kalshi’s head of enforcement and legal counsel, Robert DeNault, explained that when a potential match is identified, the associated market is flagged and the user is prevented from trading on it.

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Former FEC commissioners caution that the data-driven approach is incomplete. Sean Cooksey, who chaired the commission during the 2024 election, noted that FEC reports omit many campaign workers such as volunteers, lawyers, pollsters and subcontractors. Lee E. Goodman, another former commissioner, called the system “a constructive step” but added that it “still leaves many people who are involved in campaigns who will not show up on FEC reports.” The monitoring also does not cover state and city elections, which use separate disclosure mechanisms, nor does it capture friends or family members of staffers.

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Kalshi reported more than 150 investigations, over 100 blocked insider-trading attempts, and at least 20 referrals to law-enforcement agencies in the first quarter of 2026. Polymarket, Kalshi’s chief rival, said it has made nearly 100 referrals to authorities, including one that led to an arrest, and highlighted its “trade monitoring, on-chain transparency, reporting channels, and escalation processes.” The Commodity Futures Trading Commission, whose chair Michael Selig was appointed by former President Trump, has taken little direct action, leaving most enforcement to the platforms themselves.

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At least 21 bills aimed at regulating prediction markets have been introduced in Congress this year, none of which have advanced. The House Oversight Committee is investigating both Kalshi and Polymarket after a federal indictment of a U.S. soldier for allegedly using classified information to trade on a market. Rep. James Comer (R-Ky.) launched the probe, and both companies have provided closed-door briefings to the committee. Kalshi’s DeNault said the firm will continue to set its own rules pending congressional action.

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• “If we're able to identify a potential match, we have markets that are associated with each of the campaigns that are flagged, and those individuals would be prevented from placing trades on those markets,” — Robert DeNault, Kalshi head of enforcement and legal counsel

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• “While I think this data may be helpful in giving some picture about who is working on a particular campaign, it is by no means a complete one,” — Sean Cooksey, former FEC commissioner

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• “It is a constructive step,” — Lee E. Goodman, former FEC commissioner

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• “It is up to us to make rules of the road for our platform, whether Congress does or not,” — Robert DeNault, Kalshi head of enforcement and legal counsel

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• “Polymarket's market integrity framework includes trade monitoring, on-chain transparency, reporting channels, and escalation processes to detect, review, and respond to suspicious activity across all markets, including political markets,” — Polymarket spokesperson

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