Its March 2026 proposed rulemaking targets manipulation risks as platforms including Kalshi, Robinhood and Crypto.com face parallel federal court fights, including consolidated Ninth Circuit arguments.
The report says niche event contracts are especially vulnerable to insider influence and collusion, and argues exchanges should police bad actors while regulators pursue criminal penalties.
It warns casino-style rules could miss market-specific risks, while overly strict US regulation may push trading offshore and weak oversight could trigger a scandal that damages the sector.
With exploding growth and legal chaos, can prediction markets ever truly prevent insider manipulation and win public trust as financial tools?
Will advanced biometric and blockchain security actually stop insider trading and coordinated manipulation, or will bad actors just find new loopholes?
As AI gets better at forecasting, do prediction markets still offer unique value, or are they destined to become high-tech gambling platforms?