Prediction markets struggle to predict their own integrity crisis

Platforms that let people bet on real-world outcomes are struggling to keep cheaters out, and the problems are piling up fast.

Kalshi, one of the biggest prediction market platforms in the United States, announced Wednesday that it had fined and suspended three candidates running for office after they placed bets on their own elections. 

The company named the three as Matt Klein, a Democratic state senator from Minnesota who was seeking a U.S. House nomination; Ezekiel Enriquez, a Republican who ran in Texas’ 21st District primary; and Mark Moran, an independent Senate candidate in Virginia. 

Kalshi said the cases were caught through new safeguards the company recently put in place to stop political candidates from trading on their own contests.

The punishments were not light. 

Fines ranged from $539 to more than $6,200, and all three received five-year bans from the platform. Klein said sorry for his $50 wager, calling it a mistake. 

Moran, however, was upfront about his intentions. He said he bet $100 on himself on purpose, specifically to get caught, because he wanted to show that “any candidate with enough money” can move these markets and that an entire election can effectively be purchased. 

Kalshi said Klein and Enriquez settled their cases, but Moran refused to cooperate repeatedly, which is why his penalty landed at $6,229.30.

Lawmakers and leagues push back

Lawmakers at the state level have started responding. 

California last month blocked state officials from using insider knowledge to place bets on platforms like Kalshi and its competitor Polymarket. 

New York Governor Kathy Hochul signed an executive order banning state workers from doing the same. 

“Getting rich by betting on inside information is corruption, plain and simple,” Hochul said.

 At the federal level, the Commodity Futures Trading Commission has claimed wide authority over these markets, but several states have filed their own civil cases, arguing that the platforms break state gambling laws.

The troubles do not stop at politics. Professional sports are now part of the picture too. 

The day before the 2026 NFL Draft, on April 22, the NFL sent a formal reminder to both Kalshi and Polymarket, asking them not to offer what the league called “objectionable bets.” 

The league specifically flagged live pick-by-pick contracts as a serious risk, since draft picks often circulate on social media before teams officially announce them. 

Despite the warning, Kalshi was still running 127 separate markets tied to the draft, all of which carry the risk that people inside the league could already know the outcomes before anyone else does.

Perhaps the strangest case of manipulation came from France. 

As Cryptopolitan reported earlier today, French media claimed that a trader on Polymarket allegedly interfered with a weather sensor at Paris-Charles de Gaulle Airport to win a weather-based bet. 

According to the reports, the trader used a hand dryer on a Météo France sensor to push the temperature reading above 21°C, walking away with roughly $34,000. 

Ethereum co-founder Vitalik Buterin weighed in on the incident, saying prediction markets need to move away from depending on a single data source that someone can physically tamper with.

While both platforms deal with these headaches, their business standings are shifting. 

After leading the prediction market for years, Polymarket has now fallen behind Kalshi in trading volume, according to Dune Analytics.

The shift follows a string of internal problems, including technical failures, a contentious fee adjustment, and a platform-wide outage.

Kalshi, by contrast, has capitalized on the turmoil, recently reaching a $22 billion valuation on the back of fresh funding. Polymarket’s March transaction volume was just one-twentieth of Kalshi’s 

As the two companies fight for users and push to operate legally across all 50 states, they face the same core problem: how to stop the very people and events they are trying to predict from tilting the outcome in their favor.

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