Kalshi and Polymarket suspicious trades surge: 400+ marked transactions year-to-date

According to Reuters, prediction market’s two major platforms Kalshi and Polymarket could see a simultaneous surge in the number of flagged suspicious trades this year. Kalshi, in particular, has investigated and flagged more than 400 suspicious trades since the start of the year, over twice the total for all of 2025; Polymarket has also seen a clear increase. As annualized trading volume expands multiple-fold, both platforms and regulatory bodies face heightened pressure to monitor insider trading.

Kalshi: 400+ suspicious trades, 2x the total for 2025

Kalshi said that since the start of the year the platform has flagged and investigated more than 400 suspicious trades, more than double the total number investigated in all of 2025. While Polymarket has not disclosed specific figures, it also acknowledged that the volume of trades flagged as suspicious has risen noticeably since the beginning of the year. Kalshi’s April trading volume has overtaken Polymarket—annualized trading volume reached $178 billion, growing more than three times over the past six months; the company recently completed a $1 billion fundraising round, valuing it at $22 billion, a 10-fold jump in less than 12 months. Polymarket is in talks for another round of funding, with a valuation of about $15 billion.

Rules tighten in parallel: both platforms ban trading with confidential information

Amid regulatory pressure, Kalshi and Polymarket have recently updated their terms of service at the same time, explicitly banning bets using confidential information or illegal tips. Polymarket also removed war-themed contracts amid public criticism. CFTC Chair Michael Selig said he will actively pursue violations of insider trading. The report also points out that there has been “precise betting on the decline in oil prices before Trump’s major Iran policy announcement”—a typical scenario that regulators are concerned about.

Detection challenges: lack of comparable insider-trading information sources

Stanford Law School professor and former U.S. Securities and Exchange Commission (SEC) commissioner Joseph Grundfest said: “In the world of corporate insider trading, it’s often relatively easy to identify who has access to material non-public information and might be engaged in potentially unlawful trades; but for certain prediction markets, similar data is difficult to obtain or may be impossible to get.” Compared with publicly listed companies, which have clearly identifiable roles such as directors, employees, and financial advisers, prediction market participants are often anonymous or pseudonymous, making it difficult to investigate and prosecute suspicious trades due to data-related constraints.

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