U.S. House Committee Probes Polymarket and Kalshi Over Insider Trading Concerns

The U.S. House Oversight and Government Reform Committee, led by Chairman James Comer, has initiated an investigation into potential insider trading activities involving Polymarket and Kalshi. According to Foresight News, Comer has sent letters to Shayne Coplan, CEO of Polymarket, and Tarek Mansour, CEO of Kalshi, requesting documentation on their identity verification, geographic restriction enforcement, and abnormal trading monitoring measures. The deadline for submission is June 5. In his letter to Polymarket, Comer highlighted concerns that the anonymity and crypto infrastructure of prediction markets could present exploitable vulnerabilities for individuals with national security clearances. Previous incidents have raised suspicions of insider trading: a U.S. soldier was arrested for allegedly using inside information to profit approximately $400,000 by betting on the ousting of Venezuelan President Maduro on Polymarket. Additionally, a New York Times investigation revealed that over 80 Polymarket users established positions hours before U.S. and Israeli strikes on Iran. Meanwhile, Kalshi faced issues in April when several congressional candidates were banned for betting on their own election outcomes on the platform.