White House staff told not to place bets on prediction markets
White House Staff Advised Against Using Insider Knowledge in Prediction Markets
In late March, the White House issued a directive cautioning its employees against leveraging confidential information to wager in prediction markets. The email, dispatched on 24 March, followed President Donald Trump’s announcement of a five-day suspension on potential military action against Iranian facilities. It cited recent news reports questioning whether officials were exploiting non-public data to place bets on platforms such as Kalshi or Polymarket.
White House spokesperson Davis Ingle defended the stance, stating to the BBC that “any suggestion that Administration officials are participating in such activities without proof is unfounded and careless reporting.” The Wall Street Journal was the first to disclose the email, highlighting the administration’s efforts to address concerns about insider trading in these markets. Ingle emphasized that federal employees must adhere to ethics rules that prevent using privileged information for personal financial gain.
The BBC has reached out to Kalshi and Polymarket for clarification. The latter faced scrutiny in January when an individual placed a bet on the capture of Venezuelan President Nicolás Maduro shortly before the event was officially confirmed. The identity of the bettor remained unknown, though their account featured a blockchain-based identifier with a mix of letters and numbers. This incident sparked debates about potential access to classified intelligence.
Prediction markets, which have seen over $44bn in trading volume, have gained traction in recent months. These platforms allow users to speculate on a wide range of outcomes, from sports events to economic decisions like Federal Reserve rate cuts or local election results. However, bets tied to geopolitical conflicts have intensified discussions on the need for stricter oversight.
Regulatory Calls for Scrutiny
Democrat Congressman Ritchie Torres, a member of the House Financial Services Committee, recently submitted a letter to the Commodity Futures Trading Commission urging an examination of “suspicious” trades. The commission oversees derivatives markets, including prediction platforms. Earlier this year, Democratic lawmakers proposed legislation to outlaw betting on military-related events entirely.
“Corruption and exploitation are flourishing within the gaps and loopholes of prediction markets,” asserted New Jersey Senator Andy Kim. “This manipulation benefits a select group, leaving working Americans at a disadvantage,” he added.
