Prediction market Polymarket has said it is ready to police trading on its platform, especially as the U.S. midterm elections draw closer.

 

Confirming its preparedness for the midterm elections, Shana Bautista, Polymarket's global head of investigations and intelligence, told Reuters that the platform is not only ready to surveil midterm trading but is also working to abide by the U.S. Commodity Exchange Act (CEA) of keeping U.S. users off its international platform.

 

"I'm confident that I'm able to get the resources and the support I need," Bautista told Reuters. "I can tell you that we have the systems in place to be able to identify anomalous activity when the midterms do come."

 

By reiterating its preparedness for midterm trading, Bautista helps dispel concerns several U.S. lawmakers have long had about the role prediction markets play in insider trading, which they say threatens national security and undermines election integrity.

 

As part of its surveillance strategy for midterm trading, Polymarket will launch a new web page explaining how it protects market integrity and cooperates with law enforcement.

 

According to Bautista, this webpage outlines how Polymarket uses machine learning, blockchain analytics, trade surveillance, open source research, and third parties to spot malicious trading and insider activity on the platform. 

 

Although this program being integrated is not entirely new, Bautista said Polymarket will provide an in-depth explanation of how it works.

 

Efforts to Curb Insider Trading

 

Polymarket has consistently implemented several measures to curb insider trading and other malicious activities on its platform. Among these measures is its partnership with security firm Chainalysis and Palantir Technologies to implement several multilayered surveillance systems on its platform.

 

It has also actively worked with law enforcement to prosecute traders involved in malicious trading activities. Notable among these was its work with law enforcement in April this year to prosecute Gannon Ken Van Dyke, a U.S. Army Special Forces soldier who was charged with using classified, nonpublic military information to trade on the platform.

 

The U.S. Commodity Futures Trading Commission (CFTC) has fined Gabriel Perez, a former White House teleprompter operator, $172,000 over bets on President Trump’s speeches.

 

In a press release, the CFTC said Perez traded presidential market contracts during his time as a White House teleprompter operator. These contracts are event contracts that reflect words or phrases that the president may use during his speeches.

 

Due to his position at the White House, Perez had direct access to presidential speeches before they were delivered, allowing him to make more than $107,000 in profits between December 2025 and February 2026.

 

According to the CFTC, Perez’s actions constituted a breach of his duty of trust and confidence, leading the agency to impose a civil monetary penalty of $65,000 and order him to disgorge the $107,539.02 in profits he made from the unlawful trading.

 

A three year trading ban was also imposed on him, with the agency stating that Perez agreed to a cease and desist order resolving the violations of the Commodity Exchange Act.

 

Earlier White House Suspension

 

Gabriel Perez was a longtime White House teleprompter operator who had worked with President Trump as far back as 2016, during Trump’s first presidential campaign.

 

However, in March of this year, Kalshi’s surveillance systems flagged unusual trading patterns that did not involve the typical buying and selling behavior of most traders.

 

Upon investigation, Kalshi discovered that the account was owned by a federal White House teleprompter operator, prompting the prediction market to lock the account, which had generated more than $90,000 in profits, and refer the matter to the CFTC along with the evidence it had uncovered.

 

Following the allegations, Perez was placed on unpaid administrative leaaave by the White House. According to White House Press Secretary Karoline Leavitt, the allegations were “deeply unfortunate and frankly a disgrace.”

 

By late July, the White House released a statement saying that Gabriel Perez was no longer working for the federal government.

 

The Korea Communications Standards Commission (KCSC) has announced its decision to block domestic access to prediction market Polymarket over concerns that its activities constitute illegal gambling.

 

The decision, announced Tuesday, was reached after the Telecommunications Deliberation Subcommittee, chaired by Kim Woo Seok, a standing commissioner of the Broadcasting, Media and Communications Review Board, unanimously voted to block access to the platform.

 

According to the committee, Polymarket’s activities abet or promote gambling under the National Sports Promotion Act. Although Polymarket claimed in response to the ban that it had removed its Korean language service and that payments in Korean won were unavailable, the committee rejected the claim, saying domestic laws cannot be evaded based on service methods or other technical characteristics.

 

"As Polymarket provides a winner take all profit and loss structure based on chance, focusing on domestic specific issues such as Seoul precipitation levels in August, thereby creating a practical illegal gambling environment for domestic users, access blocking measures are inevitable to protect domestic users," the committee added.

 

The committee also asserted that, before reaching its decision, it sought the opinions of other relevant agencies, including the Korean National Police Agency, the National Gambling Control Commission, and the Korea Sports Promotion Foundation. According to the committee, these agencies shared the view that Polymarket’s activities constituted the crime of gambling.

 

Korea’s ban on Polymarket comes shortly after the French Autorité nationale des jeux (ANJ) banned the prediction market’s activities, citing the promotion of illegal gambling activities.

 

With its recent ban, South Korea has now joined the list of more than 30 countries and jurisdictions that have blocked or restricted access to Polymarket.

 

A court in the state of Washington has ordered Kalshi to halt all operations within the state, following a supposed violation of the state’s Gambling and Consumer Protection Act. 

 

Based on a memo from the office of the Washington Attorney General, Kalshi is thereby required to immediately stop the offering, accepting, and facilitating wagers on sports, elections, politics, entertainment, tech and science within the state. 

 

“Kalshi has gotten rich promoting wagers on sports, elections, natural disasters, events related to the Iran War, and more. Under this order, Kalshi is banned from offering wagers on most of those topics in Washington,” said Attorney General Nick Brown.

 

“As this case moves forward, we will continue to enforce Washington law and hold Kalshi accountable for misleading consumers.”

 

The court has also mandated Kalshi implement an IP address and residency based geofence by August 19 and a multi-source geofencing solution by Sept. 2. 

 

According to the Washington State Law, Gambling refers to any activity that involves the staking of or risking something valuable upon the outcome of a contest of chance or any future or contingent event, and going by this, all Kalshi activities completely violate the state’s law. 

 

As part of its restrictive orders, the court has also banned Kalshi from advertising any sort of wagers to Washington residents, as doing so, the attorney general memo said, constitutes an unfair or deceptive act or practice.

 

The halt order from the Washington court also comes at a time when Baltimore, the largest city in the state of Maryland also sued Kalshi, Polymarket, for violating the state’s Consumer Protection Ordinance by offering unlicensed sport contracts while also naming Coinbase, Robinhood, and Webull as defendants in the lawsuit.

 

 

Flight tracking company FlightAware has voluntarily withdrawn the lawsuit it filed against prediction market platform Kalshi on Monday.

 

Although the reason for the withdrawal was not explicitly stated in the dismissal notice filed with the U.S. District Court for the Southern District of New York, the filing revealed that the lawsuit was dismissed without prejudice, meaning FlightAware could potentially refile the case in the future.

 

FlightAware's withdrawal of the lawsuit comes shortly after it sued Kalshi over the alleged unauthorised use of its data, name, and trademarks for its flight cancellation prediction markets.

 

FlightAware alleged that Kalshi, without authorisation, used its proprietary flight data while publicly naming FlightAware as the “Primary Source Agency” and stating that all outcomes in its flight prediction markets were verified by FlightAware.

 

According to the original lawsuit filed against Kalshi, FlightAware claimed that it had sent cease-and-desist letters demanding that Kalshi refrain from using its data and trademarks, citing potential reputational damage. FlightAware said Kalshi ignored all of these warnings.

 

While neither party has issued an official statement following the filing and subsequent withdrawal of the lawsuit, some have speculated that the two parties may have reached a private agreement or settlement, potentially explaining the swift withdrawal of the case.

 

Kalshi Continues to Face Lawsuits on Multiple Fronts

 

Kalshi has continued to battle several lawsuits, particularly from state regulators, over alleged violations of state gambling laws, with its lawsuit against the New York attorney general being its most recent state-level battle.

 

Although the U.S. Commodity Futures Trading Commission (CFTC) has lately been throwing its weight around Kalshi and other prediction market platforms as it seeks to assert itself as the primary agency with jurisdictional authority over prediction markets in the U.S., Kalshi still has active court cases involving more than 15 U.S. states.

 

 

Attorney generals from 44 U.S. states have written to the Commodity Futures Trading Commission (CFTC), challenging its authority to regulate sports-related event contracts on prediction market platforms.

 

The letter, sent at the close of the public comment period for the CFTC's proposed rule and co-led by Ohio Attorney General Andy Wilson and Nevada Attorney General Aaron D. Ford, argues that the CFTC is exceeding its statutory authority with its proposed rule governing sports event contracts.

 

"The Proposed Rule goes beyond the CFTC's statutory powers, is in tension with the Constitution, and would otherwise be arbitrary and capricious in its current form," wrote the coalition of state attorneys general, led by Ohio Attorney General Andy Wilson.

 

"The CFTC should start afresh with its rulemaking and clarify that sports bets and gambling cannot be traded on designated contract markets, but are instead subject to state law."

 

Amid this joint effort to defend state-level control over prediction markets, attorneys general from Florida, Georgia, New Hampshire, Missouri and Texas did not sign the letter.

 

The joint signing of the letter by attorneys general from 44 U.S. states comes as several states remain locked in disputes with the CFTC over jurisdictional authority for sports-related event contracts offered on prediction market platforms.

 

CFTC and States Locked in Jurisdictional Battle

 

While several U.S. states have tried to exert control over prediction markets, the CFTC has continued to assert that it is the only agency with exclusive federal jurisdiction over prediction markets. That is why, in June, it issued a Notice of Proposed Rulemaking to provide greater clarity and establish a framework for determining when sports event contracts may be prohibited.

 

Despite the publication of the proposed rule by the CFTC, states have not stopped cracking down on prediction market platforms. In May, Minnesota became the first U.S. state to outright ban prediction markets, with the ban set to take effect on August 1.

 

However, the CFTC, alongside Kalshi and Polymarket, sued Minnesota and several other states, including Arizona, Connecticut, Illinois, and New York. On Monday, U.S. District Judge Katherine Menendez granted a preliminary injunction blocking the enforcement of Minnesota's ban.

 

 

World, a fully on-chain, Solana native prediction market powered by Chainlink that aims to compete with Kalshi and Polymarket, has launched on Phantom Wallet.

 

Image credit: x.com 

 

According to the team, the World prediction market will allow users to predict outcomes on crypto price movements and the ongoing 2026 FIFA Men's World Cup. Additional markets across sports, geopolitics, and macroeconomics will be added in the coming weeks.

 

"Prediction markets are one of the most powerful applications you can build on a high-performance blockchain," said Pedro Miranda, Head of Consumer at the Solana Foundation. "World is designed to show what Solana makes possible: real-time markets, on-chain settlement, and a user experience that meets people where they are."

 

Unlike most prediction markets that require users to interact with centralized infrastructure, World is designed to operate entirely on-chain. Every market, every position, and every settlement happens on-chain; as such, users do not have to move their funds to any custodial or centralized entity, as they can interact directly with Solana liquidity.

 

The platform uses $CASH as its settlement stablecoin. Since it’s launched directly within the Phantom Wallet, World will be available to more than 20 million Phantom Wallet users. It is also important to note that this World project is entirely different from Sam Altman's World. This World is a prediction market project, while Sam Altman's World is an identity project.

 

World's launch comes at a time when prediction markets are gaining significant traction, especially since the start of the 2026 FIFA Men's World Cup. Since early June, prediction market platforms, including Kalshi and Polymarket, have seen inflows of more than $3.8 billion.

 

Despite regulatory challenges in some jurisdictions, prediction market companies continue to grow and expand. Kalshi and Polymarket have both recently secured substantial funding from investors. Kalshi recently raised funding at a $22 billion valuation, while Polymarket raised $600 million at a $15 billion valuation and is reportedly in talks to raise an additional $400 million.

 

Prediction market company Kalshi has filed a lawsuit against the state of Illinois after Illinois Governor JB Pritzker signed SB 3019, the budget bill, into law last week.

 

The lawsuit, which was filed in the U.S. District Court for the Northern District of Illinois, lists key state officials as defendants, including Governor JB Pritzker, Illinois Attorney General Kwame Raoul, and other members of the Illinois Gaming Board, including Dionne R. Hayden.

 

By filing the lawsuit, Kalshi aims to block Illinois from enforcing the new tax law. Under the new law, cryptocurrency transactions in the state will be subject to taxation. The law also establishes a “Sports Wagering Fund” that would impose a 15% tax on gross receipts from sports-related prediction markets operating in the state. However, Kalshi argues that the law is preempted by the Commodity Exchange Act, asserting that its sports-event contracts are regulated by the Commodity Futures Trading Commission (CFTC).

 

“This action challenges the State of Illinois’s clear violation of the Supremacy Clause with respect to the regulation of event contracts,” Kalshi said in its complaint.

 

“The federal Commodity Exchange Act (CEA) grants the Commodity Futures Trading Commission (CFTC) exclusive jurisdiction over event contracts when they are traded or executed on a contract market that has been federally designated for that purpose.”

 

With the lawsuit filed, Illinois joins the growing list of states facing legal action from Kalshi. Late last month, Kalshi filed a lawsuit against Minnesota after the state banned prediction markets, becoming the first U.S. state to do so. Kalshi has also filed preemptive lawsuits against Rhode Island, Arizona, and Iowa.

 

CFTC’s Stance on Sports Event Contract Regulation

Despite strict regulatory control over prediction market activities by various state regulators, the U.S. Commodity Futures Trading Commission has maintained its position as the only agency with exclusive federal jurisdiction over event contracts traded on prediction market platforms.

 

Amid regulatory actions taken by state regulators, the CFTC this month released a framework that provided greater clarity on the regulation of event contracts while protecting prediction markets from state-level interference. To assert its authority, the CFTC has also sued state regulators in Arizona, Connecticut, New York, Minnesota, and New Mexico for their harsh regulatory stance on prediction market activities. 

 

 

Fomo, a cryptocurrency trading platform, has raised $75 million in a Series B funding round led by Index Ventures, with Union Square Ventures and Benchmark also participating.

 

 

According to the team, the new funding will be used to expand Fomo’s asset classes, including equities, perpetuals, and prediction markets, while scaling its engineering team and further investing in its trading and social platform.

 

Through its consumer-focused platform and the removal of some technical barriers associated with on-chain trading, such as unpredictable gas fees, fragmented blockchains, and complex token bridges, Fomo aims to seamlessly onboard users on-chain.

 

“Most trading products aren’t built with the user in mind. They are dull, hard to understand, and make you want to rip your hair out,” said Paul Erlanger, Co-founder and CEO of Fomo.

 

“Each decision we make at Fomo is made to bring our users joy. Fomo is accessible, social, and understandable in 15 minutes. We believe people should be able to access global markets instantly, share opinions and convictions through their network, and participate without needing to understand the technical complexity underneath it all.”

 

By unifying liquidity, automatically routing transactions, and supporting familiar traditional payment methods such as Apple Pay, Fomo aims to make on-chain trading more accessible. With the inclusion of new asset classes, Fomo is positioned to reach more users globally.

 

About Fomo 

Fomo is a consumer-focused, social-first crypto trading app designed to make on-chain trading simple and accessible. Everything it does revolves around its goal of simplifying crypto trading. To achieve this, Fomo integrates social trading features that allow users on the platform to discover trending assets, connect with top-performing traders, and track open positions.

 

Since launching last year, Fomo has done several impressive things, including becoming the largest cross-chain crypto trading app, raising more than $90 million in seed funding, growing its user base to more than 625,000, and processing over $4 billion in trading volume to date.

 

 

Bitbank, one of Japan’s major cryptocurrency exchanges, has warned its users against using their Bitbank accounts for Polymarket and other prediction market activities.

 

 

According to a press release from the exchange, the warning comes in compliance with Japan’s strict laws against prediction market activities, which it broadly categorizes as gambling.

 

“We would like to inform you of a cautionary note regarding the connection to and use of prediction market services, including Polymarket,” Bitbank wrote in a blog post.

 

“While these prediction market services may be operated by overseas companies, accessing them from within Japan and using them for the purpose of financial gain may constitute gambling or similar activities.”

 

As part of its enforcement measures, Bitbank said it may suspend accounts found to be involved in deposits or withdrawals related to prediction market services. If an account is suspended, the affected user will lose access to the account, including cryptocurrency deposits and withdrawals, buying and selling of crypto assets, and withdrawals in Japanese yen.

 

Bitbank’s move to restrict accounts involved in prediction markets reflects the country’s strong stance against gambling overall. The country’s penal code criminalizes all forms of wagering or gambling activities, with prison sentences of up to five years for offenders.

 

Thus, while the country or any of its financial regulators have not outright banned prediction markets, crypto entities like Bitbank, for compliance purposes, are proactively distancing themselves from prediction markets.

 

Bitbank’s restriction on prediction market activities comes shortly after the United States Commodity Futures Trading Commission released a framework that will guide the use of prediction market platforms. According to the framework, betting contracts related to terrorism, assassinations, and war are banned. Although sports event contracts can still be offered, they will be subject to thorough scrutiny to prevent manipulation.

 

Despite the regulatory bans and challenges facing the prediction market sector, prediction market companies continue to thrive and scale. Recently, Kalshi announced it had raised $1 billion at a valuation of $22 billion, while Polymarket said it was in talks with investors to raise $400 million at a valuation of $15 billion.

 

 

Indonesia’s Ministry of Communication and Digital Affairs has blocked access to Polymarket, the world’s largest prediction market platform, and plans to block all social media accounts affiliated with it.

 

According to Alexander Sabar, Director General of Digital Space Supervision, platforms that facilitate money-based betting on specific outcomes or events are still categorized as online gambling, even if they are presented as prediction markets.

 

“The government will not allow any form of online gambling in Indonesia. Activities like Polymarket involve betting and speculation on uncertain outcomes, thus violating Indonesian law,” Sabar said in Central Jakarta, one of the country’s main administrative areas.

 

The agency also said the decision to block Polymarket is intended to protect younger users and the broader public in the digital space, and added that it will block access to other platforms that facilitate online gambling activities in the country.

 

Prior to the ban, Polymarket had a limited user base in Indonesia. However, it gained greater visibility between May 20 and 21 of this month when it launched a contract on whether President Prabowo Subianto would leave office early. The contract drew significant attention in Indonesian digital spaces, attracting roughly 51,000 dollars in trading volume within days of its launch.

 

Global Crackdown on Prediction Markets Continues

Regulators' crackdown on the activities of prediction market companies continues to intensify. Just last month, Brazil’s National Monetary Council (CMN), together with other government agencies and regulators, blocked Polymarket, Kalshi, and 27 other prediction market platforms from operating in the country. This came shortly after a court in Buenos Aires reportedly ordered a ban on Polymarket in Argentina.

 

Other countries in Europe, including France, Belgium, Germany, Italy, Poland, Portugal, and Hungary, have either banned or heavily restricted the activities of Polymarket, Kalshi, and other prediction market companies within their jurisdictions.

 

In the United States, several state regulators have taken action against prediction markets, with Minnesota most recently imposing a comprehensive ban on them. At least 17 states, including Illinois, New York, and Ohio, have issued cease-and-desist orders against prediction market companies.

 

 

Polymarket, the world’s largest prediction market company, has partnered with Nasdaq, the global financial technology company, to launch the first prediction markets that track the performance and milestones of private companies. 

 

 

Prior to the launch of this new offering, only institutions and high-net-worth investors had exclusive access to invest in private, high-growth companies before they went public. However, with the launch of this new offering, individuals, including retail traders, can now access some of the most sought-after private companies before they go public. 

 

The new offering also provides real-time signals to institutional investors on how private markets are unfolding, helping them make informed investment decisions and better manage their risks. Users can now access and monitor events in the high-growth company market, which currently comprises over 1,700 unicorns globally. 

 

"Prediction markets are one of the most powerful tools we have for democratizing access to financial information and opportunity," said Shayne Coplan, Founder and CEO of Polymarket. "Today’s launch brings that power to one of the last frontiers of financial markets that retail participants have never been able to access. For the first time, anyone can engage with the outcomes driving value at the world's most consequential private companies."

 

And with the Nasdaq Private Market serving as the resolution data provider for private company markets, users can access private companies through the Polymarket platform. The “privates” section on Polymarket currently has about 20 active private markets, including SpaceX, OpenAI, Anthropic, Stripe, Anduril, and Canva. 

 

Hence, users can now transparently engage with verifiable private company events, including taking positions in a company’s valuation milestones, Initial Public Offering (IPO), and other secondary market activity. 

 

“Nasdaq Private Market has established itself as a trusted source of liquidity and investment infrastructure across the private market ecosystem,” said Tom Callahan, CEO of Nasdaq Private Market. “Polymarket has built a platform that can open access to a broader audience. We are proud to provide the data that ensures every market resolves accurately. When retail participants enter any market, high-integrity data matters.”