Kalshi will now ask you where you work before you can start betting.
Kalshi’s enforcement and legal counsel, Bobby DeNault, wrote a blog post on the company’s website on Tuesday outlining how it is clamping down on insider trading on its platform.
DeNault wrote that the New York-based prediction market will start requiring traders to complete employment verification before they can trade, an effort to “screen potential insiders.”
“This lets us identify presumptive insiders — people who have material, non-public information about a market’s outcome — and screen them out before a trade is ever placed,” he wrote.
Per a screenshot of the employment verification tool embedded in the blog post, Kalshi will ask users for their current employer’s name, industry, and job function.
Representatives for Kalshi did not respond to a Business Insider query about how long the verification process typically takes, and whether this verification will apply to traders already on the platform.
In his post, DeNault outlined two other steps that Kalshi is taking to weed out bad actors.
The first is “risk scoring,” in which the company assigns a score to each new market added onto its platform, ranging from “niche social or hobbyist markets to critical-scale markets with national or geopolitical reach.”
This will be done to determine if the market is particularly susceptible to manipulation.
And the second is “whistleblower enhancements,” which allows users to report suspicious behavior. DeNault called Kalshi users the “natural first line of defense against abusive behavior.”
These measures work on top of Kalshi’s existing guardrails, which include preemptively blocking elected politicians, political candidates, and people in college and professional sports, from trading.
Kalshi’s new guardrails come as prediction markets like itself, and Polymarket, are facing strong scrutiny from lawmakers in the country, many of whom have proposed bills to ban or stringently clamp down on their activities.
For instance, in May, Minnesota became the first state to propose a blanket ban on the markets, with Gov. Tim Walz signing off on it.
The US Commodity Futures Trading Commission, which regulates Kalshi and Polymarket, filed a lawsuit against Minnesota and Walz, arguing that Walz cannot criminalize the markets under state law.
Read the full article here
