Prediction markets are meant to be fun, informative, and competitive, but sometimes they collide with the law. Recently, popular U.S. platform Kalshi claims that two users engaged in what it describes as “insider trading,” including an employee connected to content creator MrBeast. 

Here’s everything you need to know about the situation:

What Happened?

Kalshi, a platform where users bet on outcomes ranging from elections to entertainment events, suspended and fined two users for allegedly trading on information they weren’t supposed to have.

The first case involved Artem Kaptur, a visual effects editor for Beast Industries, MrBeast’s company. Kaptur claims that Kaptur placed a $4,000 bet on the Beast Games reality show, which he worked on, arguing that he had access to inside information about the show’s content.

Kalshi says it has suspended Kaptur for two years and fined him over $20,000.

Beast Industries, in a statement, says it has zero tolerance for employees using proprietary information and has launched an independent investigation.

“Beast Industries has no tolerance for this behaviour, whether by contestants or our own employees,” the company that employed Kaptur said in a statement. 

"We have a longstanding policy in place against employees using proprietary company information, which safeguards the highest standards and ethics throughout our organisation."

The second case involved Kyle Langford, an American politician who bet $200 on his own candidacy for California governor and posted about it online. Kalshi says it has banned him for 5 years and fined him 10 times the trade amount.

Langford is now running for Congress and has not publicly responded.

Prediction markets like Kalshi aren’t just games; they’re regulated financial exchanges under the U.S. Commodity Futures Trading Commission (CFTC). That means trading on inside knowledge is treated the same way it would be in stock or futures markets.

The CFTC recently issued an advisory highlighting the Kalshi cases and suggesting that these trades may have violated U.S. law. Chairman Mike Selig called exchanges like Kalshi the "first line of defence" against insider trading.

Kalshi says it has investigated more than 200 insider trading cases and currently has over a dozen active cases. 

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TechloyOgbonda Chivumnovu