CFTC Highlights Insider Risks After Kalshi Trader Sanctions

US regulators have renewed warnings over improper trading in prediction markets after two enforcement cases on KalshiEX raised concerns about the misuse of privileged information. The Commodity Futures Trading Commission (CFTC) said insider conduct and fraud remain fully subject to federal oversight.

One case involved a political candidate who traded contracts tied to his own election. Kalshi imposed financial penalties and a multi-year suspension. A second case concerned a YouTube channel editor who traded contracts linked to the channel, with the exchange citing misuse of material nonpublic information and issuing a larger fine and suspension.

While Kalshi handled both matters internally, the CFTC emphasized that it retains authority to prosecute violations on registered exchanges. The agency also reiterated that prediction markets fall within its jurisdiction, amid ongoing legal disputes over event contracts.