Overview
- Trading on major prediction platforms has surged to roughly $24 billion in monthly volume by April, creating a far larger and faster market for election‑related wagers.
- Platforms have taken direct steps: Kalshi suspended three congressional candidates for betting on their races in April and Polymarket says it has referred nearly 100 user wallets to law enforcement for suspicious trades.
- Regulators and Congress are moving to act, with the CFTC asserting oversight and the U.S. Senate banning members and staff from prediction‑market bets while House Republicans are proposing further limits on lawmakers and candidates.
- Enforcement capacity is a growing problem because investigations require human review and the CFTC’s enforcement staff is reported to be unusually low, which could leave many referrals unexamined as midterms near.
- The rise of thousands of contests and more granular contracts expands the pool of people with nonpublic information—campaign workers, pollsters and donors—which raises the risk of insider trading and could erode public trust in both markets and elections.