Goldman Sachs, JPMorgan, and others tighten prediction market trading rules as insider trading concerns grow

Odaily Planet Daily News As prediction markets raise concerns over insider trading, Goldman Sachs has banned its employees from trading prediction market contracts related to the bank's own events, elections, financial markets, macroeconomic data, and geopolitics. Financial institutions including Morgan Stanley, JPMorgan Chase, and Bank of America are also formulating or updating relevant policies, with Bank of America already clarifying prohibited behaviors in prediction market trading to its employees.

Previously, the U.S. Commodity Futures Trading Commission (CFTC) and the Department of Justice charged a Google employee with using non-public information to trade contracts related to "Search of the Year" on Polymarket, profiting approximately $1.2 million. Legal experts note that the CFTC still lacks mature precedents in enforcing insider trading laws within prediction markets, and the wide variety of prediction market contracts adds to the complexity of regulation.

Currently, Kalshi and Polymarket have respectively launched employment verification tools and partnered with Chainalysis and Palantir to monitor suspicious trading activities. (CNBC)