New York and Illinois Move to Restrict Insider Trading in Prediction Markets
New York Governor Kathy Hochul and Illinois Governor JB Pritzker issued orders barring state employees from using nonpublic information in prediction markets, while Kalshi disclosed three insider cases involving fines and suspensions.
Summary
New York Governor Kathy Hochul signed an executive order banning state employees from using nonpublic information to bet on prediction markets, and Illinois Governor JB Pritzker issued a similar order on Tuesday. The actions target the risk that government insiders could exploit confidential information in event-based markets. Kalshi said it handled three candidate self-betting insider cases and imposed fines and suspensions.
Terms & Concepts
- Prediction market: A platform where traders buy and sell contracts tied to the outcome of future events, such as elections or policy decisions.
- Insider trading: The use of material nonpublic information to gain an unfair advantage in trading or market participation.
- Nonpublic information: Confidential information not available to the broader market that could affect trading decisions or contract prices.