Speaking to Bloomberg, the Chairman of the Commodities Futures Trading Commission (CFTC) has made it clear that the agency is actively overseeing trades made on prediction markets regarding the US midterm elections.
In August, a Republican House candidate from North Carolina was issued a three-year ban from Kalshi for purchasing contracts related to her own candidacy. Along with the ban, the candidate was also fined over $2,000.
Despite not confirming whether there were any active investigations regarding the midterms, Selig was steadfast in saying that any version of market manipulation will be prosecuted.
Further, CFTC's Director of Enforcement David Miller has also publicly clarified what the agency considers insider information during this year's political cycle.
Miller stated that candidates' employees are also not allowed to place bets on prediction markets as they are likely under confidentiality agreements. Therefore, if someone were to use non-public campaign information to engage with prediction markets, Miller says: "We'll come after you."
Miller also mentioned that he has a team ready for election night, on November 3, to monitor all election-related trades to scan for possible fraud.
As of writing, traders across Kalshi and Polymarket have spent more than $220m on the 2026 midterm elections. This number dwarfs the prior election cycle of $92m.
Although concerns have been raised over the risk of market manipulation created by midterm-focused event contracts, Kalshi recently partnered with CBS News to integrate prediction market data into the broadcaster's coverage of the elections.
The NFL called on the Supreme Court to consider prediction markets forms of gambling and to outright ban contracts that are too susceptible to manipulation
