Growing Ethics Gap in Political Prediction Markets

Close-up of a roulette wheel with a spinning ball

America’s elections are quietly turning into a money game, as campaign insiders use secret data to place bets on the very races they help run.

Story Snapshot

Campaign staffers admit making “thousands” betting on their own candidates with insider polling data.
Prediction market platform Kalshi is blocking trades and flagging campaign staff, but says the rules are still “up to us.”
No clear federal ban covers campaign staff, leaving a legal gray zone between gambling and insider trading.
Both parties talk reform, yet Congress and regulators struggle to keep up with this new form of political profiteering.

Campaign insiders turning elections into a betting game

NPR reports that multiple campaign staffers working on statewide races have used internal polling and strategy data to bet on their own candidates and cash out for “thousands” of dollars. One staffer called election prediction markets the “Wild West” for people who want to make a quick buck by turning campaign secrets into easy money. For everyday voters, these markets look like simple gambling. For insiders who see private polls before the public, it can feel like risk-free profit.

These bets are not happening on shady offshore sites alone. They are happening on large, U.S.-facing prediction platforms like Kalshi and Polymarket that market themselves as data tools for media, investors, and politically engaged citizens. When insiders “buy low” on a candidate before a positive poll is released, they can move prices and shape the story of who is “surging” or “collapsing” in real time. That means secret campaign information is not just helping someone get rich. It may also skew how the public sees the race.

Platforms scramble to police insider trading with limited rules

Kalshi, now the biggest U.S. prediction market, says it has built its own guardrails because Congress and regulators have not yet done so. The company cross-checks Federal Election Commission payroll records against its user list to block staffers from betting on their own races, and reports launching more than 150 insider trading investigations and blocking over 100 suspect trades in early 2026. Kalshi has even referred around 20 cases to law enforcement, trying to show it is serious about policing abuse.

Kalshi’s enforcement chief says “it is up to us to make rules of the road” until Washington acts. Two former Federal Election Commission officials told NPR this internal policing is a “constructive step,” but warned that many people with real campaign power, including consultants and volunteers, never appear in federal payroll data. That means serious insiders can still slip through the cracks. Other reporting finds similar gaps on Polymarket, where a Google engineer was arrested after using confidential company information to win more than $1 million, proving prosecutors will act when the evidence is strong.

Law struggles to catch up to prediction markets and insider bets

Legal experts say the basic rule is simple: if someone has a duty to keep information secret and uses that information to trade for personal gain, that can violate the Commodity Exchange Act. Former Commodity Futures Trading Commission trial lawyer Jeff Le Riche told NPR that campaign staff bets using confidential data check all the main “insider trading” boxes. They breach trust, use material nonpublic information, and know the data is not meant for public use. Yet, as of now, no federal case has directly targeted campaign staffers for this behavior.

This gap exists partly because prediction markets sit between finance and gambling law, and the rules are still fuzzy. The Brennan Center warns that treating these markets as neutral “information tools” is dangerous when insiders are driving prices. At the same time, a federal court ruling in 2024 forced the Commodity Futures Trading Commission to rethink its attempt to block election contracts, opening the door for more regulated election betting even as insider risks grow. The result is a familiar “regulatory lag” where new money tools spread faster than the rules that should shape them.

Growing public anger and slow political response

Survey research shows almost 70 percent of Americans want a ban on government officials trading on prediction markets, and many support limits any time insiders hold nonpublic information about political events. Responding to this pressure, the Senate has barred senators and their staff from betting on prediction markets, and Republicans in the House have opened an investigation into how platforms detect and stop insider trading. Lawmakers from both parties have floated bills to extend bans and treat prediction markets more like casino gambling.

Yet key loopholes remain. House members, executive branch staff, military officials, and campaign workers across the country can still wager on many political markets. Platforms continue to “self-regulate,” deciding which trades look suspicious and which users get banned, even though analysts warn companies cannot be the final referees for a system they profit from. For many Americans on the left and right who already believe a small group of insiders and “deep state” elites game the system, insider betting on elections looks like one more way politics has become a rigged casino instead of a fair contest decided by voters.