Kalshi, the CFTC-regulated U.S. prediction market leader, plans to require users to disclose their employer before trading certain sensitive contracts amid escalating insider trading concerns. According to WSJ, the rollout is expected in the coming weeks, directly addressing rising risks tied to government and corporate information. The new rule builds on existing measures including detailed onboarding screens for high-risk individuals, real-time trade surveillance with third-party partners, and account freezes during investigations. Kalshi has already responded aggressively, opening over 200 investigations in the year leading to February 2026, resulting in public disciplinary actions including fines and multi-year suspensions for violations. The enhanced controls reinforce Kalshi's positioning for institutional and compliance-conscious participants, potentially attracting capital wary of looser offshore or crypto-native alternatives.
The Senate has already taken decisive action against lawmaker participation in prediction markets, with senators unanimously passing a rule on April 30, 2026 barring themselves and their staff from trading on platforms like Polymarket and Kalshi. As reported by multiple sources, this unanimous passage in a chamber as divided as the Senate signals that concern about lawmakers betting on prediction markets crosses party lines completely. The Senate move came amid rising worry about insider trading on these platforms and about event contracts that can involve sensitive outcomes, with the ban applying to senators and their offices immediately instead of waiting on a lengthy implementation process.
Representative Bryan Steil, who chairs the House Administration Committee, announced that lawmakers are working to extend a congressional stock trading ban to include prediction markets. According to Bloomberg Government, Steil told reporters during a Thursday roundtable that the legislation would prohibit members of Congress, their spouses, and dependents from trading individual stocks while also adding prediction market restrictions. The H.R. 7008 bill was reported out of committee in February and placed on the House calendar, with Steil expecting the House could vote on the measure during the summer. Speaker Mike Johnson (R-La.) confirmed Thursday that he intends to put the stock ban bill on the floor this summer. The bill appeared to garner some initial bipartisan support, as it is sponsored by both Representatives Bryan Steil (R-WI) and Ritchie Torres (D-NY). During the 118th Congress, a similar bill of the same name was introduced and passed the House Financial Services Committee, although it stalled before receiving a full chamber vote.
The regulatory pressure has intensified significantly with the White House sending an internal email warning staff against using non-public government information on platforms including Kalshi on March 24, 2026. In May 2026, House Oversight Committee Chair James Comer launched a formal probe, sending letters to Kalshi CEO Tarek Mansour and his counterpart at Polymarket seeking details on user verification and suspicious activity monitoring. The enforcement challenge remains significant, as decentralized platforms like Polymarket operating on blockchain face verification difficulties compared to centralized venues like Kalshi. Congress is also debating whether additional restrictions should apply to prediction markets operating outside the U.S., recognizing that a purely domestic rule can be circumvented by routing through offshore or decentralized venues.
The prediction markets sector continues to expand significantly, with the industry processing roughly 191 million transactions in March while monthly trading volume reached about $23.9 billion. According to previous reporting, political, economic, and geopolitical contracts accounted for much of that activity, increasing the industry's visibility in Washington. The PREDICT Act would bar the president, vice president, and all 535 members of Congress from prediction-market trading, covering roughly 537 federal officials. Representative Ritchie Torres introduced the Campaign Funds Integrity Act of 2026, which targets the use of campaign funds for prediction-market gambling with criminal penalties of up to five years imprisonment. A separate bipartisan Senate bill from Senators Adam Schiff and John Curtis takes aim at sports-betting and casino-style contracts. With prediction market volumes continuing to climb and regulators watching closely, this enhanced regulatory framework could influence industry standards for balancing innovation with safeguards.
