Prediction market operator Kalshi is rolling out new compliance measures aimed at addressing mounting concerns over insider trading, the exchange said Tuesday, the latest defense in a sector battling mounting insider trading concerns.
The new requirement applies to markets deemed at higher risk for insider trading or market manipulation, Kalshi said in a blog post
The disclosure rule kicks in only for markets the exchange flags as carrying an elevated risk of insider trading or manipulation, such as contracts pegged to corporate performance, national security, and major geopolitical flashpoints such as the Iran war. Traders who hit that threshold should fill out an online form with their employment details. Kalshi said it won’t check the information unless an investigation is already underway, though it may bar some users from individual contracts depending on where they work.
Risk scoring Alongside the disclosure requirement, Kalshi announced a “risk scoring framework” designed to identify markets with elevated insider trading risk. When a market is proposed for listing, it runs through a system weighing six factors, including corporate KPI or events risk, outcome concentration risk, market importance, regulatory risk, non-traditional insider risk, and national security risk. Less important markets carrying high insider or manipulation risk may be rejected from listing entirely.