Stopping insider trading

Not all prediction markets are equal.

Kalshi is federally regulated and based in the US, where insider trading and market manipulation are illegal. Offshore prediction markets often do not comply with US law or police fraudulent activity.

Unregulated platforms

Insider trading rules

Prohibited by law

No rules exist

Identity verification

Full KYC required

None

Trade surveillance

24/7 real-time

Zero

Regulatory oversight

Federal Regulators

None

Violations reported to

Federal Regulators

Nobody

Historical enforcement

200+ investigations

Screening

We proactively screen to prevent insider trading.

Political persons

Candidates, Congress, Campaign staff, election officials, poll workers and anyone whose political role creates a conflict with a specific market.

Sports professionals

Athletes, coaches, referees, team and league personnel are screened in partnership with the NHL and IC360, the leading integrity provider for professional leagues and the NCAA.

Disqualified persons

Certain felons, persons subject to CFTC disqualification, and sanctioned individuals are barred from trading under federal law and Kalshi's rules.

Surveillance

Real-time surveillance to flag suspicious patterns.

Detect

Pattern recognition runs continuously against every trade. We look for anomalous timing, win-rate irregularities, and coordinated activity.

Investigate

Flagged accounts are frozen immediately. Our compliance team reviews funding sources and trading history. We also gather third-party intelligence. Our legal department determines whether a violation has occurred.

Enforce

Confirmed violations result in disgorgement, fines, multi-year suspensions or permanent bans. All confirmed violations are reported to the CFTC.

Case studies

Our surveillance team is catching bad actors.

The Governor Candidate

In May, our Surveillance Department saw an online video by a candidate for Governor of California that appeared to show him trading on his own candidacy.

We immediately froze his account and opened an investigation. The candidate was initially cooperative and acknowledged that this violated the exchange rules. As a candidate in a race, you can — and probably should — follow and use Kalshi's market forecast, but you should not trade on it.Penalty: 5-year ban, 10× financial penalty

The Video Editor

The second case involved trading in markets tied to a popular YouTube streamer's videos. Our surveillance systems flagged near-perfect trading success on markets with statistically low odds — anomalous at a scale that could not be explained by skill alone.

Because all trading data is publicly available, multiple Kalshi users also submitted tips about the unusual activity. Investigation revealed the trader was employed as an editor for the streamer's show, with likely access to material non-public information connected to his trading.Penalty: 5-year ban, 10× financial penalty

Our standards

Stricter than stock exchanges.

Federal insider trading law was designed for equities. Kalshi mirrors those standards — then goes further, because event markets require restrictions that classical doctrine was never built to address.

Unregulated platforms

Prevention-first: High-risk individuals are blocked from trading markets where they could have an insider edge.

Post-trade surveillance only. No proactive restrictions on specific participants.

Proactive screening: Political persons, sports industry professionals, and others are blocked from relevant markets.

Only corporate insiders are blocked. No special restrictions against political persons who may also have an inside edge.

Influence-based prohibition: Explicitly prohibits trading by anyone who can influence the result — not just those who know it in advance.

Addresses informational asymmetry only. Participants who can directly control outcomes face no restriction.

Accounts frozen immediately upon flag — before profits can be withdrawn.

Enforcement is typically post-withdrawal, after profits are already secured.

Transparency

Kalshi leverages its community to flag potential cheating.

100% of trades are visible to the public

Our users are always looking at trading patterns and submit whistleblower tips when they see something suspicious. Public data turns the crowd into a forensics weapon and makes it difficult for insiders to hide.

In the MrBeast editor case, multiple Kalshi users submitted tips that aided the investigation.

Advisors

Advised by leading
integrity experts.

Prof. Daniel Taylor

Forensic investigationsWharton Forensic Analytics Lab

Brian Nelson

Financial compliance & integrityFormer U.S. Treasury Under Secretary for Terrorism and Financial Intelligence

Lisa Pinheiro

Market & price manipulation expertIndependent Chair, Surveillance Audit Committee

Solidus Labs

Behavior monitoring & pattern recognitionInstitutional monitoring partner

Robert J. DeNault

Former white-collar criminal attorneyHead of Enforcement

IC360

Sports integrity partnerIntegrity Compliance 360

Our belief

Trust is the foundation
of all markets.

Market integrity is the only way for markets to become trusted infrastructure. Help us ensure our markets are fair and free from insider trading.

Report an insider