White House staff received a warning last month instructing them not to leverage insider information to place bets on prediction markets. The advisory was sent out on March 24, the day after U.S. President Donald Trump announced a five-day pause on threats to target Iranian power plants and energy infrastructure.
The email addressed concerns raised in press reports regarding the potential misuse of non-public information by government officials on platforms such as Kalshi and Polymarket.
White House spokesperson Davis Ingle asserted that 'any implication that Administration officials are engaged in such activity without evidence is baseless and irresponsible reporting.' The Wall Street Journal initially reported on the email.
Ingle emphasized that all federal employees are bound by government ethics guidelines prohibiting the use of insider information for financial gain, stating, 'The only special interest that will ever guide President Trump is the best interest of the American people.'
The BBC has sought comments from Kalshi and Polymarket regarding these concerns. Polymarket was previously scrutinized in January after a bettor reportedly won a significant amount on the outcome of Venezuelan President Nicolás Maduro's capture, sparking worries about accessing inside information regarding U.S. military operations.
Prediction markets have gained popularity recently, handling over $44 billion in trades associated with various events, including sports and economic decisions. Congressman Ritchie Torres has called for investigations into 'suspicious' trades related to this practice, while legislation has been introduced to fully ban betting on conflicts.
Senator Andy Kim highlighted the risks of corruption and exploitation in prediction markets, emphasizing that such manipulation primarily benefits a select few at the expense of the general population.
