Two Senators Write to Kalshi and Polymarket About Election Contracts

As the midterm elections were held on Tuesday, two senators sent a joint letter to the executives of Kalshi and Polymarket. Senators John Coplan and Elizabeth Warren expressed concern that contracts in election-linked prediction markets could be open to market manipulation.

The letter asks what efforts the companies are making to prevent trading on inside information. The senators asked that the information they requested be shared in detail.

Prediction markets, platforms where users trade based on the outcomes of specific events, have recently drawn the attention of both investors and regulators. On issues that directly concern the public, such as elections, how prices are formed and who trades in these markets has become a subject of debate.

This move is seen as a concrete example of the regulatory pressure the sector is likely to face during election periods. Responses from Kalshi and Polymarket could show what security measures the companies apply to these kinds of contracts.