Polymarkets and Kalshi Draw a Line — No More Insider Trading or Manipulation

Prediction market platforms Polymarket and Kalshi both moved to crack down on insider trading with new policies. 

In a recent press release, Polymarket announced updated market integrity rules applying to both its DeFi platform and its CFTC-regulated US exchange.

“These rule enhancements make our expectations abundantly clear for every participant across both platforms and highlight the compliance infrastructure we have already built. As Polymarket continues to scale, we will build on our foundation with clear communication to Polymarket’s users to ensure our markets do what they do best — surface truth,” said Neal Kumar, Chief Legal Officer of Polymarket.

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Polymarket’s rules outline three main categories of prohibited insider trading conduct. Users may no longer trade on stolen confidential information, act on illegally tipped data, or place bets when they hold enough authority or influence to affect an event’s outcome.

The platform also launched Market Integrity pages. These pages explain how the rules apply in practice and provide reporting channels for suspicious activity.

Beyond insider trading, Polymarket’s rules ban spoofing, wash trading, fictitious transactions, self-dealing, front-running, information misuse, and other disruptive practices that undermine orderly markets.

Kalshi Launches New Screening Tools

Kalshi, a rival prediction market, also expanded its “internal capabilities and policies” to curb insider trading and market manipulation.

“We’re launching new technological guardrails that preemptively block politicians, athletes, and other relevant people from trading in certain politics and sports markets. These efforts, which have been in the works for months, proactively address the CFTC’s guidance and Congressional bill proposals to prevent insider trading. Kalshi looks forward to engaging with regulators and other industry participants to make these efforts a standard across the industry,” the blog read.

The platform announced tools designed to preemptively block political candidates from trading on their own campaigns. Kalshi is also implementing sports-specific screening in partnership with IC360 partners.

The platform said it is using curated lists to preemptively block college and professional athletes, personnel, and referees from trading in markets tied to their affiliated leagues.

Furthermore, Kalshi added a whistleblower feature directly on its market pages, allowing community members to flag potential violations while browsing public trading data.

The announcements come as regulators and lawmakers intensify scrutiny of prediction markets. Yesterday, Senators Adam Schiff and John Curtis introduced the “Prediction Markets Are Gambling Act.” The bill sought to ban prediction market platforms from offering contracts tied to sporting events.

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