Wall Street or Vegas? Prediction market in New York under scrutiny amid insider trading, gambling concerns
New York regulators are examining prediction markets like Kalshi and Polymarket due to concerns about insider trading and potential gambling risks.Summary
Prediction markets, such as Kalshi and Polymarket, are facing increased scrutiny from lawmakers in New York and Washington D.C. over concerns of insider trading and gambling. These concerns were heightened after a trader profited significantly from correctly predicting the capture of Nicolás Maduro before an official announcement. While these platforms claim to be trading venues for financial traders, some users view them as a form of gambling. The New York State Gaming Commission has issued a cease and desist letter to Kalshi, leading to a lawsuit arguing it's a trading platform under federal jurisdiction. Lawmakers are considering bills to ban trading on predictions related to sports and politics, fearing manipulation and its impact on everyday people. Despite existing regulations against using non-public information for trading, enforcement remains a challenge, and Polymarket's terms of service lack specific mention of insider trading.
(Source：Newyork Cbs Local)