Kalshi bans former US politician… five-year suspension for insider-trading breach

Kalshi, a US prediction-market platform, has kicked a former politician off its platform for violating insider-trading rules.

According to Cointelegraph on the 25th (local time), Kalshi said it had identified a former California gubernatorial candidate who bet about $200 on his own chances of winning, and imposed a five-year account suspension and a $2,000 fine. The individual is reportedly currently running for the US House of Representatives.

In a statement, Kalshi Executive Officer Robert Deno said the politician’s use of his candidate status to place trades constituted a breach of insider-trading rules. Kalshi added that the account did not withdraw any profits and that it reported the incident to the US Commodity Futures Trading Commission (CFTC).

On the same day, Kalshi said it also sanctioned a YouTube editor in another insider-trading case. The user conducted trades totaling about $4,000 between August and September 2025, and received a two-year trading ban and a fine of about $20,000. Kalshi said its surveillance system detected an “almost perfect” rate of return in low-probability markets.

Kalshi, a CFTC-regulated designated contract market, said it has investigated 200 cases to date, with more than 12 still ongoing. It has recently established a surveillance audit committee and is working with trade-surveillance platform Solidus Labs to strengthen detection of market-abuse activity.

CFTC Commissioner Mike Selick warned that “the first line of defense against insider trading in prediction markets is the exchange,” adding that it will take action against attempts at market manipulation, fraud and insider trading.