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

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

Previously, the U.S. Commodity Futures Trading Commission (CFTC) and the Department of Justice accused a Google employee of using non-public information to trade "Search of the Year" related contracts on Polymarket, profiting about $1.2 million. Legal experts say the CFTC still lacks mature cases in the enforcement of insider trading in prediction markets, and the wide variety of prediction market contracts has also increased regulatory difficulty.

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