What to know:
- Kalshi and Polymarket ban athletes and politicians from trading on related markets and prohibit using confidential info.
- US lawmakers propose banning sports-related prediction markets, sparking federal vs. state dispute.
- Kalshi and Polymarket explore fundraising despite Arizona charges and state cease-and-desist orders.
Prediction market platforms Kalshi and Polymarket are both strengthening their policies to stop insider trading and uphold market integrity. This is partly due to increasing regulatory concerns in the US. Such steps are being taken as legislators propose a ban on sports-related prediction markets, arguing that there are issues with consumer protection and regulatory oversight.
Kalshi and Polymarket’s New Rules
Kalshi has made it clear that they will not allow athletes, coaches, and political candidates to place bets on markets related to their own events, and they have teamed up with IC360 for the registration verification process. Meanwhile, Polymarket has come up with a comprehensive set of rules forbidding the use of confidential information. Both these steps are geared towards making the markets more transparent and making it harder for people to manipulate them.
Also Read: Kalshi’s Nevada Ban: A Pivotal Turning Point for Prediction Markets in 2026
Feds vs. States on Prediction Markets
The new push to ban sports-related prediction markets, spearheaded by Senators Adam Schiff and John Curtis, reveals the dispute over which governmental level should regulate these activities. Prediction market proponents say that they are basically financial instruments regulated by the federal government, while states consider them illicit gambling operations that require licensing.
This disagreement has resulted in Arizona bringing criminal charges against Kalshi and at least five other states issuing cease-and-desist orders. Even though the regulatory environment is quite tough, Kalshi and Polymarket are still both in talks with investors and trying to raise money at a $20 billion valuation per company.
Also Read: Kalshi and Polymarket Seek New Funding at $20B Valuation
Balancing Innovation and Compliance
Both companies argue that the new guidelines that they have just introduced will not only guarantee the integrity of the market but also provide protection to the users. When regulators start imposing a new set of rules, prediction market operators will find themselves in a situation where they will have to go a little bit further with their innovations but at the same time will, have to make sure that they know their customers and stay within the limits that regulators have set in order not to be faced with an even greater level of regulatory activities that can be very disruptive.
Also Read: Kalshi Faces $54 Million Lawsuit Over Disputed Bet on Iran’s Leader Death
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