The U.S. House Oversight Committee has opened an investigation into major prediction market platforms Polymarket and Kalshi over concerns that U.S. government employees may be using insider information to profit from policy and national security events. According to reports from CNBC, Rep. James Comer, R-Ky., chair of the House Oversight and Government Reform Committee, is seeking internal records from the platforms' CEOs to determine if government employees are using insider knowledge to profit from policy and geopolitical and military operations. As reported by The Information, Comer stated that the 'growing pattern of insider trading activity on prediction market platforms indicates that Congressional action may be necessary.'
Comer told CNBC that the probe aims to prove a case for legislation that would bar members of Congress, administration officials and other government employees from participating in prediction markets. As reported by CNBC, Comer stated that it wouldn't be too much to ask to say members of Congress can't participate in the predictions market, nor can government employees or people in the president's administration. The investigation represents the most recent attempt by Congress to investigate prediction markets and bring insider trading under control.
In letters sent Friday to Polymarket's Shayne Coplan and Kalshi's Tarek Mansour, Comer demanded clarity on how the platforms handle identity verification, enforce geographic restrictions and flag anomalous trading activity. According to a Wall Street Journal report, prediction market volumes could peak to roughly $1 trillion by 2030, as the sector evolves from niche wagering into broad-based information markets spanning sports, crypto, politics and the economy. Volumes hit $51 billion last year and could reach about $240 billion in 2026.
The House probe follows a heated U.S. Senate Commerce Committee hearing on Wednesday, where lawmakers from both parties heavily scrutinized prediction market platforms. As reported by CoinDesk, Senate Commerce Chair Ted Cruz (R-Texas) blasted the industry for enabling cheating scandals across major sports leagues, warning that the opportunity to profit on event contracts tempts athletes and officials to manipulate outcomes. Meanwhile, Senator John Hickenlooper (D-Colo.) accused the firms' aggressive social media marketing of 'preying on our young people' and fostering problem gambling.
Nicolas Vaiman, co-founder and CEO of onchain intelligence layer Bubblemaps, expressed deep concern over the national security implications of a new wave of insider trading. According to CoinDesk, Vaiman warned that if those observing the predictions markets can spot irregular trades, so can enemies of the United States. His team found 80 bets on Polymarket with a 98% win rate, which he said is statistically impossible to achieve, stating that 'not even luck can explain those wins'.
