Still, prediction markets look a lot like betting if you squint, which is why states like New York have tried to regulate them under gambling laws. To head this off, Kalshi has sought federal protection under the Commodity Futures Trading Commission (CFTC). Yes, this means regulation for Kalshi, but it also means the CFTC will sue states like Kentucky, Minnesota, Illinois, and Rhode Island, trying to pre-empt their laws in favor of a single national standard that the CFTC controls.
But there are also more ridiculous stories, such as disgraced former Congressman George Santos, who allegedly talked up his upcoming appearance at the State of the Union, secretly bet on whether he would attend, and then didn’t go at the last minute to score a payout.
This activity raises questions, like: How many people are gambling forecasting the future based on government secrets or insider knowledge? How many are actively manipulating results they have bet on? Even the Trump White House was concerned enough to issue a memo in March telling employees not to “use nonpublic information to buy or sell these contracts.”
But concerns have lingered, especially after major wins on contracts involving US government policy or actions. Such suspicions will not be helped by new allegations today from multiple outlets that insider trading on Kalshi has extended even to President Trump’s teleprompter operator, who allegedly made $100,000 “forecasting” specific words and phrases that might appear in Trump speeches.
The mention market
According to sources speaking to NPR, Trump aide Gabriel Perez bet on something called a “mention market.” This is a section of Kalshi where you can sink money into contracts on crucial questions such as “What will Domino’s say during their next earnings call?” (Currently, $26,000 has been invested in this question; the smart money thinks that “Parmesan” and “DomOS” are more likely to be mentioned than not.)
In the case of Perez, his “forecasting” allegedly took place over several months at the end of last year and the beginning of this year, and his contracts were sometimes adjusted in the middle of Trump speeches. According to ABC:
Sources say Perez typically has the final eyes on nearly all of the president’s prepared remarks—and is often known to take last-minute edits from Trump himself… In certain instances, investigators uncovered times when Perez would back out of certain bets mid-speech when Trump skipped over a portion of the speech that included a word he had previously bet would be mentioned, the sources said.
This conjures up an amazing mental image: The teleprompter operator for one of the world’s most powerful people tapping away at his phone during a Trump speech to ensure he made more money for himself. [...]
Whatever you want to call it, “predicting the future with money at stake” has become huge business in America. A recent (and terrific) long article by McKay Coppins in The Atlantic showed people what a year of online sports gambling looks like, and it raised serious questions about the negative issues that widespread, legal, bet-from-your-phone gambling might cause in a country where “roughly half of men ages 18 to 49 have an active account with an online sportsbook.”
by Nate Anderson, Ars Technica | Read more:
Image: Getty
[ed. See also: Sucker (The Atlantic article) mentioned. And: Truth Social to sell trading firms 'fastest' access to Trump's posts (Reuters).]
